ACTIONABLE ADVICE FOR FINANCIAL ADVISORS: Newsletters and Commentaries Focused on Investment Strategy

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2015-07-31 00:00:00 Michigan Consumer Sentiment: Small Decline but Still Positive Trend by Doug Short (Article)

The University of Michigan Final Consumer Sentiment for July came in at 93.1, a decrease from the 96.1 June final reading. Investing.com had forecast 94.0 for the July Final. The Index is at its highest eight month average since 2004.

2015-07-31 00:00:00 ECRI Weekly Leading Index: Up Slightly from Last Week by Jill Mislinski (Article)

ECRI continues to feature an article posted on July 15th suggesting that concern over negative trend growth is no reason to panic. Recession is not imminent as we are not yet in a "window of vulnerability." The article also discusses Spain's recent cyclical upturn and warns that one shouldn't assume that a cyclical upturn also means positive long-term trend growth. The overall message is not to "fret about recession just yet".

2015-07-31 00:00:00 Moving Averages: June Month-End Update by Jill Mislinksi (Article)

Valid until the market close on June 30, 2015

The S&P 500 closed May with a monthly gain of 1.05%. All three S&P 500 MAs and three of the five Ivy Portfolio ETF MAs are signaling "Invested". In the table, monthly closes that are within 2% of a signal are highlighted in yellow.

2015-07-31 00:00:00 Aligning Beliefs: 7 Tenets of Russell Investments Target Date Funds by John Greves of Russell Investments

Russell Investments’ John Greves examines 7 tenets in constructing target date funds.

2015-07-31 00:00:00 The Danger in "Debalancing" by John West, Brandon Kunz, Amie Ko of Research Affiliates

Eat a balanced diet. Drilled into our brains since preschool, this advice falls squarely in the “duh, everybody knows that” camp. But it’s not just kids who need reminding. Parents and grandparents, as role models and dietary enforcers, do too. Common sense alone tells us this universally applicable dictum is the right way to eat. Different foods have different nutritional and caloric values. If we eat a wide variety of food groups, or as a five-year-old child is taught, “Eat a rainbow,” good nutrition is likely to take care of itself.

2015-07-31 00:00:00 Say A Little Prayer by Bill Gross of Janus Capital Group

I’m not what you would call a “prayerful” type of guy. Even at 30,000 feet, when the air gets rough, I never invoke the “God” word, settling instead for promising myself that if I ever get back to terra firma, I will never fly again, which I promptly forget days or even hours later. It’s not that I’m a non-believer in prayer’s ultimate destination, but more of a cynical take on why the Lord would hand out party favors to everyone that asked, or to those that asked most intently.

2015-07-31 00:00:00 3 Questions to Check Yourself Before You Wreck Yourself by Adam Butler, Michael Philbrick, Rodrigo Gordillo of BPG & Associates

A few simple questions one should ask oneself before making any decisions in public markets.

2015-07-31 00:00:00 September Hike Still on the Table by Brian Wesbury, Robert Stein of First Trust Advisors

No one expected the Federal Reserve to make any changes to monetary policy at today’s meeting and there were no surprises.

2015-07-31 00:00:00 China’s Stock Market Plunges Again (But Not to Worry) by Brad McMillan of Commonwealth Financial Network

It turns out that China’s stock market remains a market after all, despite the Chinese government’s best efforts. Prices on the Shanghai Composite Index fell 8.5 percent on Monday and another 1.7 percent Tuesday, stripping away more than half of the gain since the last bottom.

2015-07-31 00:00:00 Is The Fed Now looking At A December Lift Off? by Eric Bush of GaveKal Capital

One of the data releases that has gained more attention recently than what it has historically received is the quarterly Employment Cost Index (ECI). With focus moving to not just job growth, but wage growth as well, the ECI index is a data point that Fed watchers are watching to guess what the Fed’s next move is going to be. Unfortunately for those that were wanting a September lift-off, the ECI thoroughly underwhelmed during the second quarter.

2015-07-31 00:00:00 Why the Dollar’s Strength Can Continue by Russ Koesterich of BlackRock

Though currency market volatility is likely to continue, Russ sees the greenback continuing to move higher for these reasons.

2015-07-30 00:00:00 Market Cap to GDP: The Buffett Valuation Indicator Remains in Levitation Mode by Doug Short (Article)

With today's release of the Advance Estimate for Q2 GDP along with revisions for the previous 12 quarters, we now have a fresh look at the popular "Buffett Indicator" -- the ratio of corporate equities to GDP. The latest data keeps the indicator in levitation mode at a new interim high.

2015-07-30 00:00:00 New Jobless Claims Up 12K by Jill Mislinski (Article)

Today's seasonally adjusted 267K new claims was slightly better than the Investing.com forecast of 270K. The four-week moving average at 274,750 is just over 8K above the 15-year interim low set in mid-May.

2015-07-30 00:00:00 Visualizing GDP: A Look Inside the Q2 Advance Estimate by Doug Short (Article)

The chart below is a way to visualize real GDP change since 2007. It uses a stacked column chart to segment the four major components of GDP with a dashed line overlay to show the sum of the four, which is real GDP itself. Here is the latest overview from the Bureau of Labor Statistics:

2015-07-30 00:00:00 Moving Averages: Month-End Preview by Jill Mislinksi (Article)

Here is an advance preview of the monthly moving averages we track after the close of the last business day of the month. At this point, before the open on the last day of the month, all three S&P 500 strategies are signaling "invested" -- unchanged from last month. Four of the five Ivy Portfolio ETFs - iShares Barclays 7-10 Year Treasury (IEF),Vanguard REIT Index ETF (VNQ), PowerShares DB Commodity Index Tracking (DBC), and Vanguard FTSE All-World ex-US ETF (VEU) - are signaling "cash", compared with last month's triple cash signal (IEF, VNQ, DBC).

2015-07-30 00:00:00 Q2 GDP Advance Estimate at 2.3%, Close to Mainstream Forecasts by Doug Short (Article)

The Advance Estimate for Q2 GDP, to one decimal, came in at 2.3 percent, a substantial increase from the 0.6 percent of Q1, which is an upward revision from -0.2 percent prior to today's annual revisions. Today's number came in a tad on the light side of most mainstream estimates. The WSJ survey of economists had median and mean forecasts of 2.6 and 2.7, respectively. Investing.com was looking for 2.6.

2015-07-30 00:00:00 Opportunities in International Equity Markets by Matthew Beesley, CFA, Head of Global Equities (Article)

Matthew Beesley, CFA, Head of Global Equities, provides an update on the International Select Equity Fund’s strategy and overall market outlook for the second half of 2015. Beesley comments on how well positioned the international markets appear to be relative to the challenges that the US may be facing soon. Further, he notes that he is finding significant opportunities in both European and Japanese markets while having an increased interest in the Emerging Markets.

2015-07-30 00:00:00 Concerned About Interest Rates Rising? Consider Convertibles by Sponsored Content from Invesco (Article)

  • Convertible securities uniquely combine equity and bond features.
  • In my view, convertibles are attractive today due to their historical performance during rising interest rate periods.
  • I examine asset class performance during each of the last 10 periods of US rising interest rates.

2015-07-30 00:00:00 In Defense of Varoufakis by Mohamed A. El-Erian of Project Syndicate

Greeks and other Europeans may fault Yanis Varoufakis, Greece's former finance minister, for pursuing his agenda with too little politesse while in office. But the essence of that agenda was – and remains – largely correct.

2015-07-30 00:00:00 Q2 GDP Per Capita at 1.7 for Advance Estimate by Doug Short (Article)

The Advance Estimate for Q2 GDP, to one decimal, came in at 2.3 percent, up from the 0.6 percent of Q1, which is an upward revision from -0.2 percent prior to today's annual revisions.. But with a per-capita adjustment, the data series is currently at 1.7 percent (1.66 percent to two decimal places). The 10-year moving average illustrates that US economic growth has slowed dramatically since the last recession.

2015-07-30 00:00:00 Solomon's Long Duration Investment Wisdom by William Smead of Smead Capital Management

Storm clouds seem to build by the day. Many investors have an ongoing love affair with a few large-cap and more futuristic companies, yet they have corrected the prices of any stock with disappointing earnings or an attachment to the production of commodities.

2015-07-30 00:00:00 How Hemlines Affect The Market by Tyler Howard of Saturna Capital

George Taylor's "Hemline Index Theory" has persisted since 1926, but is it true? If you search long enough, or mine enough data, you are bound to find correlations that, while statistically robust, have no meaningful explanatory power.

2015-07-30 00:00:00 Money Market Reform: Reflections on This Critical Inflection Point for Cash Liquidity Investing by Jerome Schneider of PIMCO

On July 23 2014, the Securities and Exchange Commission (SEC) formally approved additional reforms for money market funds. These changes will directly impact institutional investors and definitively alter the dynamics of liquidity markets.

2015-07-30 00:00:00 A Midyear Look at Global Real Estate by Ivy Global Real Estate Team of Ivy Investment Management Company

There are many drivers of recent short-term price changes for publicly traded real estate companies in the current market environment. These include changes in the market’s outlook for economic growth, for interest rate movements, for central bank actions and even the issues surrounding Greece and Ukraine.

2015-07-30 00:00:00 Minimum Wage Hikes: Fast Food for Thought by James Tierney, Jr. of AllianceBernstein

The minimum wage is rising across the US, and fast-food companies are feeling the pinch. In our view, watching how companies cope reinforces the importance of a selective approach to stockpicking.

2015-07-30 00:00:00 Greece and China: The New Not Ready For Primetime Players by Chris Richey of Neosho Capital

A paper on the present Greek and Chinese capital market crises, which have their roots in policies carefully crafted over the past two decades meant to bring about the integration of their respective economies into that of the wider world.

2015-07-30 00:00:00 U.S. Dollar Still Stands Tall by Burt White of LPL Financial

The U.S. dollar remains strong, defying some skeptics. As has been the case since late 2008 when the Federal Reserve (Fed) began its quantitative easing (QE) program, there has been a great deal of concern recently among some market participants that the dollar is on the verge of a significant decline. Although the dollar may have lost some market share relative to other global currencies in recent decades, it remains the dominant global currency (often referred to as a reserve currency) and we expect it to remain so for the foreseeable future.

2015-07-30 00:00:00 Rising Rates: Threat or Opportunity by Eric Stein, Andrew Szczurowski of Eaton Vance

Investors should take an active approach to duration management and favor assets that have historically benefited from a rising rate environment.

2015-07-30 00:00:00 Is it Time to Buy Commodities? by Russ Koesterich of BlackRock

Russ Koesterich explains what's behind the recent commodity rout and whether it represents an opportunity for investors.

2015-07-30 00:00:00 Are US Middle-Class Incomes Really Stagnating? by Martin Feldstein of Project Syndicate

The challenge of raising the incomes of middle-class families has emerged as an important focus of the unfolding US presidential election campaign. Unfortunately, the political debate is distorted by misleading statistics that grossly understate how well middle-income families have actually done over the past few decades.

2015-07-30 00:00:00 When the Fed Begins to Tighten, Quality Stocks Matter by Jeff Moser of Wells Fargo Asset Management

The Federal Reserve has finally signaled its intent to raise (or normalize) interest rates. The question for investors now is what sort of companies stand to benefit the most, as Fed stimulus exits the system? Low-quality stocks benefited from a long cycle of Fed accommodation, but the potential for tighter monetary policy could mean investors should look to higher-quality stocks instead. In a potentially rising-interest-rate environment, investors should look for these five indications of quality.

2015-07-29 00:00:00 Millennials and the Labor Force: A Look at the Trends by Jill Mislinski (Article)

We have added Millennials to our series of employment demographics. The general consensus is that the Millennial cohort consists of people born between the early 1980s to the early 2000s. In this study we will focus on the Bureau of Labor Statistics data for the those born between 1981 and 2000.

2015-07-29 00:00:00 Inflation Deniers Emboldened by Gold's Struggles by Clint Siegner of Money Metals Exchange

The vultures are circling. Precious metals bulls, laid flat by gold and silver prices dropping for the 5th week in a row, are watching deflationists such as Harry Dent and the financial media squawk about the imminent demise of precious metals.

2015-07-29 00:00:00 Equities, Dividends & Rising Interest Rates by Guinness Atkinson Investment Team of Guinness Atkinson Asset Management

With interest rates at generational lows and what is likely an improving US economy, it is natural to contemplate or even worry about the possibil- ity of rising interest rates. Common perception is that rising interest rate environments are generally not favorable to equities and income oriented in- vestments. This is certainly true for bonds1 whose prices move directly and inversely with changes in interest rates. But is it true for equities in general and for dividend paying stocks in particular?

2015-07-29 00:00:00 Some Overseas Markets May Prove More Resilient by Russ Koesterich of BlackRock

Russ explains why he believes European and Japanese equities can continue to outperform U.S. stocks.

2015-07-29 00:00:00 Price-Insensitive Sellers by Ben Inker of GMO

In a new quarterly letter to GMO's institutional clients, co-head of asset allocation Ben Inker examines the impact on a range of global asset classes of "price-insensitive market participants" who may "buy assets for reasons other than the expected returns those assets may deliver."

2015-07-29 00:00:00 Ten Quick Topics to Ruin Your Summer by Jeremy Grantham of GMO

Chief investment strategist Jeremy Grantham reviews "10 topics that really matter, at least in my opinion. They can all be viewed as problems: potential threats to our well-being"

2015-07-29 00:00:00 June Pending Home Sales Snap a Five-Month String of Increases by Doug Short (Article)

Earlier today the National Association of Realtors released the June data for their Pending Home Sales Index. The NAR reports that "after five consecutive months of increases, pending home sales slipped in June but remained near May’s level, the highest in over nine years." The adjacent chart gives us a snapshot of the index since 2001.

2015-07-29 00:00:00 China's Stock Market: Can Beijing Keep It Steady? by Milton Ezrati of Lord Abbett

The Chinese economy likely will sustain a pace of growth strong enough to stabilize stock prices.

2015-07-29 00:00:00 Laudato Sí by Bill O’Grady of Confluence Investment Management

Last week, the Vatican held a meeting of the mayors of some of the world’s largest cities to discuss climate change. This meeting was part of Pope Francis’s efforts to add to the discussion of climate change, which was the subject of a recent encyclical, Laudato Sí. In this report, we will begin with our position on climate change, discuss the encyclical and try to measure its potential impact on the direction of climate change policy. As always, we will conclude with market ramifications.

2015-07-29 00:00:00 Embrace, Don’t Fear, Illiquid Asset ETFs by Richard Bernstein of Richards Bernstein Advisors

Our research suggests that while many are fearful of the unknown, investors should embrace, not fear, illiquid asset ETFs.

2015-07-29 00:00:00 Diversify and Conquer: Enhancing Equities in Your Glide Path by Daniel Loewy, Christopher Nikolich of AllianceBernstein

Equities take a lead role in any target-date glide path because they’re the most reliable engine for investment growth. But even that engine could use some help in the future.

2015-07-29 00:00:00 Thursday's GDP Report May Hold Big Surprises by Gary Halbert of Halbert Wealth Management

The next few days should be an interesting time in the markets. The Fed Open Market Committee (FOMC) is meeting today and tomorrow and will release its latest policy statement at the conclusion of the meeting. While it is not expected that the Committee will vote to raise the Fed Funds rate at tomorrow’s meeting, Fed Chair Janet Yellen has been talking hawkishly about a rate hike of late.

2015-07-29 00:00:00 Next Generation Thinking: Saving by (Article)

How can advisors help millennials save for retirement? Look to T. Rowe Price for insights.

2015-07-29 00:00:00 Next Generation Thinking: Investing by (Article)

How can advisors help millennials invest for retirement? Look to T. Rowe Price for insights.

2015-07-29 00:00:00 Next Generation Thinking: Engagement by (Article)

How can advisors engage and motivate millennials? Look to T. Rowe Price for insights.

2015-07-28 00:00:00 Consumer Confidence Drops Nine Points by Jill Mislinski (Article)

The latest Conference Board Consumer Confidence Index was released this morning based on data collected through July 16. The headline number of 90.9 was a significant drop from the June final reading of 99.8, a downward revision of June's initial 101.4. Today's number was below the Investing.com forecast of 100.

2015-07-28 00:00:00 Career Center by Various (Article)

Find career opportunities for firms that seek to add financial advisors and planners to their staff. Read more to find out how to post opportunities at your firm.

2015-07-28 00:00:00 Home Price Rose at a Slightly Slower Pace, Year-over-Year, in May by Doug Short (Article)

With this morning's release of the May S&P/Case-Shiller Home Price we learned that seasonally adjusted home prices were down fractionally month over month and rose across the country over the last 12 months but at a slower pace. The seasonally adjusted 20-city index, the most closely watched of the Case-Shiller series, was down -0.2% from the previous month. Nonseasonally adjusted it was up 4.9% from a year ago.

2015-07-28 00:00:00 Are Managed-Payout Funds Better than Annuities? by Joe Tomlinson (Article)

Managed-payout funds promise to meet retirees’ need for sustainable lifetime income without relying on annuities. To see whether this promise can be fulfilled, I’ll answer three questions: What’s the best design for such funds? How do they compare to annuities? Can retirees do even better by combining managed-payout funds and annuities?

2015-07-28 00:00:00 Should You Dress Down for Client Meetings? by Dan Richards (Article)

In a previous article, Dan Solin pointed to research on how performance improves if people dress in a more professional fashion. But my recent conversations with advisors and clients suggest that while dressing up can have a positive impact, you can overdo it. In fact, in some cases it makes more sense to dress down.

2015-07-28 00:00:00 Late-Cycle Warnings from the M&A Market by David Schawel (Article)

Are we nearing the end of the equity bull market? An ominous signal is coming from recent activity in the M&A market.

2015-07-28 00:00:00 Why Most Quantitative Investing and Trading Systems Fail by Baijnath Ramraika, Prashant Trivedi (Article)

Most, if not all, quantitative systems are designed by selecting factors that were present in successful investments/trades over a selected back-test period. That process, however, too often results in strategies that fail to produce results that are as successful as in the historical data. Here’s why.

2015-07-28 00:00:00 The Positive Use of Negativity Bias by Daniel Solin (Article)

In an article last week, I discussed how an understanding of three behavioral biases (in-group, confirmation and illusion-of-control bias) can help you gather more assets. Today, I will tackle another prevalent bias – negativity bias – and provide suggestions for how to use knowledge of its effects to your advantage.

2015-07-28 00:00:00 Why High Performing Individuals Fall Apart in a Team by Beverly Flaxington (Article)

I have hired the best individual contributors anyone could find. Individually, they are strong performers, but they trip over one another whenever they have to agree on ways to meet client needs. Are there incentives or punishments I can dole out to change this dynamic?

2015-07-28 00:00:00 Is The Biotech Bull Market Still Intact? by Eric Bush of GaveKal Capital

Biogen’s $85 (or 22%) drop on Friday has put a spotlight on the biotechnology sub-industry as a whole. And rightfully so, as biotech has been the best performing sub-industry in the United States over the past four years (as always, this data is on an equal-weighted basis). Biogen, which was the third largest biotech stock by market cap before the drop and is now the fifth largest, has generally been a stock market leader. Whenever leadership begins to turnover that is usually an important signal for the market. So has biotech run its course?

2015-07-28 00:00:00 Is Sovereign Debt Sacrosanct? by Paul DeNoon of AllianceBernstein

Many governments face large and seemingly insurmountable levels of debt. Headline mainstays Greece, Ukraine and Puerto Rico have recently been the subjects of debate over the necessity or suitability of receiving debt relief. Other governments may soon find themselves under the same spotlight.

2015-07-28 00:00:00 Greed and Genius?! by Jeffrey Saut of Raymond James

Greed is always hard to measure. Certainly we have seen some signs of it in the Big Bio-Bubble and the new issue market.

2015-07-28 00:00:00 When Will We Ever Learn? by Lance Roberts of Streettalk Live

Life is full of irony. When I was in school, I hated history. It was boring. It was pointless. How was reading about a bunch of dead people ever going to be useful in life? Today, I consume everything I can find on history. Particularly, financial history. Ironic.

2015-07-28 00:00:00 The Song Remains the Same? Higher Rates Don’t Typically Kill Bull Markets by Liz Ann Sonders of Charles Schwab

Because we don’t anticipate any fireworks—or even notable news—out of the July Federal Reserve meeting, we are not publishing a dedicated report on the meeting or the accompanying statement. However, we are keenly aware of the attention on the Fed and the likelihood it begins raising short-term term interest rates this year. Our view remains that September is the most likely month, barring any significant change in the trajectory of job growth in the next two months.

2015-07-28 00:00:00 Weighing the Week Ahead: What is the Message of the Market? by Jeffrey Miller of NewArc Investments, Inc.

As I have noted for the last two weeks, this earnings season carries a special significance. It provides an alternative to the official data on the economy.

2015-07-28 00:00:00 Equities Retreat, but Long-Term Prospects Should Improve by Robert Doll of Nuveen Asset Management

At the beginning of July, it became clear that Greece and European policymakers would come to at least a temporary debt agreement. Since that time, U.S. equity prices jumped, with the S&P 500 Index climbing more than 4% by the beginning of last week.

2015-07-28 00:00:00 Active, Passive and Personal by Patty Quinn McAuley of Clark Capital Management Group

Jack Bogle telling investors to sit tight and buy low-cost index funds is a little bit like the FDA telling Americans to eat right and exercise to stay healthy. In theory it sounds right but in practice, well… some of us could use a more active approach.

2015-07-28 00:00:00 Home Ownership Drops to a New Interim Low by Doug Short (Article)

As residential real estate prices rise, home ownership continues to decline. The Census Bureau has now released its latest quarterly report with data through Q2. Here is a snapshot of the nonseasonally adjusted series with a 4-quarter moving average to highlight the trend.

2015-07-28 00:00:00 What Volatility Really Means by Greg Tournant of Allianz Global Investors

Despite predictions of a jump in 2015, the VIX has historically shown the ability to stay lower than many believe possible. Greg Tournant, CIO US Structured Products at Allianz Global Investors, explains the root causes and implications of volatility in today’s market environment.

2015-07-28 00:00:00 GDP Rebounds in Q2 by Brian Wesbury, Robert Stein of First Trust Advisors

The US economy rebounded in the second quarter from the supposed decline in real GDP in Q1. We say “supposed decline” in Q1 because the government has had persistent problems seasonally adjusting GDP, tending to underestimate growth in the first quarter each year while overestimating growth in the middle two quarters.

2015-07-28 00:00:00 Richmond Fed: Manufacturing Jumped 7 Points in July by Jill Mislinski (Article)

Today the Richmond Fed Manufacturing Composite Index jumped 7 points to 13 from last month's 6. Investing.com had forecast no change at 6. Because of the highly volatile nature of this index, we include a 3-month moving average to facilitate the identification of trends, now at 7.7, indicating expansion.

2015-07-27 00:00:00 Weekly Gasoline Price Update: Largest Weekly Drop Since January by Jill Mislinski (Article)

It's time again for our weekly gasoline update based on data from the Energy Information Administration (EIA). The price of Regular and Premium dropped six and five cents respectively from last week. According to GasBuddy.com, California has the highest average price for Regular at $3.83 with Los Angeles averaging $4.15. South Carolina has the cheapest at $2.31.

2015-07-27 00:00:00 See How NFRA Is Built by (Article)

NFRA supports exposure to utilities, transportation and energy, plus communications and government outsourced holdings.

2015-07-27 00:00:00 S&P 500 Snapshot: Day Five of the Selloff by Doug Short (Article)

The big pre-open news today was the historic -8.48% Monday rout in the Shanghai Composite, an event that no doubt rattled the optimists hoping that the China benchmark index had bottomed out last week. Euro zone indexes also saw some suffering, with DAX and CAC 40 both deep in the red and destined to close with -2.5% losses. The S&P 500 dropped at the open, ignoring a modest improvement in June Durable Goods. A rebound attempt topped out in late morning, and the index spent the day drifting lower to its -0.58% close, its fifth consecutive finish in the red.

2015-07-27 00:00:00 The Active-Passive Debate with Rand Spero by (Article)

Rand Spero, an advisor and president of Massachusetts-based Street Smart Financial, discusses how he decides when to use actively managed funds instead of passive indices.

2015-07-27 00:00:00 The New Role of the Financial Advisor by John Diehl, Senior Vice President, Strategic Markets Hartford Funds (Article)

“The New Role of the Financial Advisor” explores key drivers for decision making in the financial services business and what differentiates one advisor from another. John Diehl discusses how investment performance has become an expected competency and sheds light on what today’s client expects.

2015-07-27 00:00:00 June Durable Goods: A Bit of a Bounce by Doug Short (Article)

The latest new orders headline number at 3.4% percent was above the Investing.com estimate of 3.0% percent. This series is down -2.8 percent year-over-year (YoY). If we exclude transportation, "core" durable goods came in at 0.8 percent month-over-month (MoM), a bit above the Investing.com estimate of 0.5 percent. However, the core measure is down -4.5 percent YoY. If we exclude both transportation and defense for an even more fundamental "core", the latest number was up 1.1 percent MoM, but down -3.0 percent YoY.

2015-07-27 00:00:00 The "Real" Goods on the June Durable Goods Data by Doug Short (Article)

Earlier today the Census Bureau posted the Advance Report on June Durable Goods New Orders. This series dates from 1992 and is not adjusted for either population growth or inflation. Let's now review Durable Goods data with two adjustments. In the charts below the gray line shows the goods orders divided by the Census Bureau's monthly population data, giving us durable goods orders per capita. The blue line goes a step further and adjusts for inflation based on the Producer Price Index for All Commodities, chained in today's dollar value.

2015-07-27 00:00:00 Screens vs. Windows: Why Choosing a Fund Manager Requires Both by Tracy Fielder of Invesco Blog

Choosing the right fund manager is an important decision for investors, and many rely on data screens to help them sift through mountains of performance numbers. But screens alone don’t tell you the whole story. To get a clear view of how a fund might fit into your portfolio, you also need a window into the mind of the manager.

2015-07-27 00:00:00 Forecasting Q2 GDP: Gazing Into the Crystal Ball by Doug Short (Article)

The big economic number this week will be the Q2 Advance Estimate for GDP on Thursday at 8:30 AM ET. With the Q1 GDP of -0.2% behind us, what do economists see in their collective crystal ball for Q2 of 2015? Let's take a look at the latest GDP forecasts from the latest Wall Street Journal survey of economists conducted earlier this month.

2015-07-27 00:00:00 CEF Product Perspective by (Article)

With a look at time horizons, active management and alternative investments, Kimberly Flynn of Nuveen shares a CEF product perspective.

2015-07-27 00:00:00 Global Equity Income Fund, Quarterly Review and Outlook by Job Curtis, Director of Global Equity Income (Article)

Job Curtis, Director of Global Equity Income, provides a portfolio and economic update for the Henderson Global Equity Income Fund (HFQAX). Broadly speaking, with growth picking up in Europe and well established in the US, he believes the outlook for equity markets is reasonably good. There is plenty of dividend yield out there and we are able to find companies with a combination of dividend yield and dividend growth.

2015-07-27 00:00:00 On My Radar: Grantham, HY and the Cyclical Bear in Gold by Steve Blumenthal of CMG Capital Management Group

If you’re young, take the whack [and] if you’re old, pray for the Fed to keep going.”– Jeremy Grantham

2015-07-27 00:00:00 The Nuclear Deal is Mostly about Oil by John Browne of Euro Pacific Capital

The recent nuclear non-proliferation agreement between Iran and the U.S. has created a firestorm debate in the Middle East and both sides of the Atlantic. While the deal is supposedly all about nuclear power and nuclear bombs, its practical implications are all about oil. But the conclusions we should make about its impact on the energy sector are far from clear. A ratification of the deal would allow Iran to make lucrative long term production and distribution contracts with foreign energy firms.

2015-07-27 00:00:00 Dallas Fed Manufacturing Outlook Rose for a Second Month but Still in Negative Territory by Jill Mislinski (Article)

This morning we got the most recent Dallas Fed Manufacturing Outlook. The latest index came in at -4.6, still negative but rose for the second month in a row. The Investing.com forecast was for a reading of -3.5.

2015-07-26 00:00:00 Mid-Year Update: A Look at the High Yield Market by Tim Gramatovich of AdvisorShares

I have seen every cycle since 1985 and while this cycle which began in 2009 has not been without a few warts, it has also been very different and far more conservative than many of these prior cycles. The majority of issuance was and continues to be for refinancing activity. This lowers interest expense and improves credit metrics for companies. Case in point, as noted below, high yield interest coverage (cash flow, or earnings before interest taxes, depreciation and amortization divided by interest expense) has steadily improved and at the highest levels we have seen over the past 15 years.

2015-07-26 00:00:00 Chugging Along by John Osterweis, Matt Berler of Osterweis Capital Management

Sitting down to write this quarter’s Outlook we feel a bit sheepish. Despite all the headlines and drama around the world (e.g., Greece, Mid-East turmoil, China stock market bubble), not much has changed in our outlook for the U.S. economy or the U.S. financial markets. The U.S. economy appears to have rebounded in the second quarter from the first quarter swoon.

2015-07-26 00:00:00 US Equity and Economic Review: Transports Still Concerning, Edition by Hale Stewart of Hale Stewart

The Conference Board released the leading and coincident indicators, both of which provide an excellent summation of current and future activity.

2015-07-26 00:00:00 European Drama Hasn’t Derailed US Growth by Ed Perks of Franklin Templeton Investments

We believe headwinds to growth have been easing and what the current leg of the US expansion has perhaps lacked in intensity may very well be made up for by a transition to a more durable or lengthy expansion.

2015-07-26 00:00:00 Memorize This, Earn a Dollar by John Hussman of Hussman Funds

As a kid growing up in the 1960’s, I earned my allowance the usual way; cutting grass and raking leaves. When there was no grass to cut or other work to do, my parents – who deeply valued education – would give us things to commit to memory. I figure I squeezed more than 30 bucks out of memorizing the multiplication tables up to 12. My brothers were better at memorizing poetry, but I was pretty good at song lyrics, which put me in good position to learn the words to countless 70's songs (e.g. "This really blew my mind.

2015-07-25 00:00:00 World Markets Weekend Update: The Previous Week's Rally Suffers a Setback (Except for China) by Doug Short (Article)

Seven of the eight indexes on our world watch list gave back part of their gains from the previous week. The one positive outlier was the manic-depressive Shanghai Composite, which advanced 2.87% over the past five sessions. The Western indexes fared the worst of our gang of eight. The UK's FTSE 100 was the worst loser and a negative outlier in that its -2.88% decline more than eradicated its gain from the previous week.

2015-07-25 00:00:00 International Economic Week in Review: IMF Lowers Growth Projections, Edition by Hale Stewart of Hale Stewart

At the macro level, the IMF lowered their global growth outlook. The first quarter slowdown in the developed world (largely the US but to a lesser extent Canada) led to decreased 2H15 projections, while the commodity slowdown will negatively impact the developing world. As further evidence of this, note that Latin American currencies are broadly selling off. Low inflation gives central banks plenty of policy room. The wild cards continue to be the cumulative impact of the Chinese slowdown along with certain geopolitical factors such as the Middle East turmoil and Greek situation.

2015-07-25 00:00:00 3 Reasons Why Gold Isn’t Behaving Like Gold Right Now by Frank Holmes of U.S. Global Investors

The last time the metal descended this quickly was 18 months ago, on January 6, 2014, when someone brought a massive gold sell order on the market before retracting it in a high-frequency trading tactic called “quote stuffing.”

2015-07-25 00:00:00 Asia Insight: Online to Offline—The Great Technology Migration by Michael Oh of Matthews Asia

Asia has demonstrated an uncanny ability to leapfrog certain technological developments, making much quicker transitions to new technologies than Western countries: jumping from fixed line to wireless communications and moving away from desktop devices to mobile devices. Now, the latest interesting instance of technology leapfrogging that is happening in Asia is dubbed “Online-to-Offline,” commerce, or O2—an e-commerce model that combines offline opportunities with online platforms. Asia Insight explores.

2015-07-25 00:00:00 Should We Offer More Help to Homeowners? by Carl Tannenbaum of Northern Trust

• Should We Offer More Help to Homeowners? • The Dodd-Frank Act Observes Its Fifth Anniversary • Canada Looks South for Economic Support

2015-07-25 00:00:00 Let’s Put Some Context To This Stock Buyback Craze by Eric Bush of GaveKal Capital

According to this CNBC article, “twenty percent of the S&P 500 have reduced their share count by 4% year-over-year in each of the last five five quarters” with the trend continuing in the second quarter. There are plenty of large buyback programs being undertaken by large-cap companies such as Intel and McDonalds and in that CNBC article they also mention Apple as a company joining the “buy back monsters” such as IBM and Exxon Mobile. However, for the market as a whole, is this time really all that different?

2015-07-25 00:00:00 Weekly Market Summary by Urban Carmel of The Fat Pitch

What looked like the promising start of a new uptrend reversed hard this week. There's a plausible scenario for SPX to fall under 1980 in the weeks ahead. Most of the indices ended the week oversold and on support. For now, it's reasonable to assume that the multi-month trading range pattern will predominate, but a bigger correction very likely still lies ahead.

2015-07-24 00:00:00 Parsing Puerto Rico by Anthony Valeri of LPL Financial

Puerto Rico municipal bond prices continue to reflect a significant probability of a potential default or debt restructuring. Puerto Rican difficulties are coming to a head: The commonwealth is suffering through a recession that began in 2006, a severe cash crunch has increased the prospects of a missed bond payment, and a greater than forecast budget deficit means that revenue fell short again and more cost reductions are needed.

2015-07-24 00:00:00 The Rise of the Renminbi: Will China’s Yuan Become a Global Reserve Currency? by Mark Mobius of Franklin Templeton Investments

Reserve currency status and RMB internationalization could confer a number of significant benefits on China, including potentially lowering borrowing costs and facilitating overseas expansion by Chinese companies.

2015-07-24 00:00:00 Can We All Stop Being Surprised By Company Earnings “Surprises” by Eric Bush of GaveKal Capital

According to the FT, S&P 500 earnings are on track to decline by about 2.6% year-over-year which is actually about 2% better than what analysts were expecting at the end of June. So this is turning out to be a better earnings season than must expected? Not really. This is just a continuation of the game where consensus expectations are moved lower and lower until companies can, you guessed it, “surprise” to the upside.

2015-07-24 00:00:00 Is Social Security on Life Support? by Gail Buckner of Franklin Templeton Investments

The benefit of securing your future by building your own financial nest egg goes without saying, but developing a Social Security strategy can be a key part of the equation that can help lead to a less stressful future.

2015-07-24 00:00:00 Does Your Muni Bond Fund Own Puerto Rico’s Bad Debt? by Frank Holmes of U.S. Global Investors

While the media and investors are focused on Greece, Puerto Rico is having a debt meltdown of its own. The U.S. territory owes lenders over $70 billion, $5.4 billion of which is due in the next 12 months. But without some form of debt restructuring, says Governor Alejandro García Padilla, it will be unable to meet its obligations. Countless municipal bond fund investors—many of them unaware they have exposure to the Caribbean island—could be affected.

2015-07-24 00:00:00 Market Timing Is Not Appropriate for Retired Investors by Chuck Carnevale of F.A.S.T. Graphs

Any discussion on the appropriateness of any “investment” strategy should start with a discussion on the important differences between investing versus speculating. Although these are radically different concepts, it is all too common in finance jargon to ubiquitously reference all financial activity as investing, even when speculating would be the more precise term. I believe it is vitally important for people to understand the distinctions between investing and speculating, and it’s even more important to be cognizant of which you are engaging in.

2015-07-24 00:00:00 Do Transport Stocks Signal a U.S. Selloff? by Russ Koesterich of BlackRock

Russ Koesterich and an investment strategist on his team, Kurt Reiman, explain what the recent divergence between Dow Transports and Dow Industrials signals for the broader market.

2015-07-24 00:00:00 Is Gold Dead? by Treesdale Partners of AdvisorShares

Gold hit $1080 per ounce Sunday night which was the lowest price level since February 2010. Gold in U.S. dollar (USD) terms has a three-year annualized return of -11.1%. It is no wonder that money managers currently carry the smallest net long positions in gold.

2015-07-24 00:00:00 Don’t Let the Noise Keep You Up at Night by Carl Kaufman, Simon Lee, Bradley Kane of Osterweis Capital Management

Three subjects have concerned the markets recently: a Greek debt default and possible exit from the European Union (Grexit), the Federal Reserve’s (the Fed’s) normalization of interest rate policy and potential bond market illiquidity following a rise in interest rates. The first two are binary outcomes, which have been debated in the marketplace for years. While discussing these possible outcomes ad nauseam may be a palliative to some, in our view it doesn’t really provide much meaningful, incremental information until more definitive actions are taken.

2015-07-24 00:00:00 Sector Insights-Financial Services by Mark Dawson of Rainier Investment Management

The financial services sector is unique. Unlike other sectors, it is essentially the lifeblood of the economy. When it’s healthy, it provides businesses and consumers with access to the credit, capital and investments that are vital to a healthy and growing U.S. economy. But when it’s sick, as we saw during the financial crisis in 2008, it can weaken the whole system. Severely damaged in 2008, the U.S. financial system - in particular banks - have been healing. Now is a good time to seek out investment opportunities in financial stocks.

2015-07-24 00:00:00 Dark Clouds Clearing by Byron Wien of Blackstone

We are at a point when various macroeconomic events could have a significant impact on the financial markets. Here are my thoughts on recent events in Greece, the Iran negotiations, China and the United States.

2015-07-24 00:00:00 Europe: Running on Borrowed Time by John Mauldin of Mauldin Economics

Rather than wander deep into the weeds looking at financial indications, however, we are going to explore what I think is a very significant nonfinancial factor that will impact the future of Europe. If it was just money, then Prodi would be right – they could just create new economic policy instruments, whatever the heck those might be. But what we’ve been seeing these last few months is symptomatic of a far deeper problem than can be addressed with just a few trillion euros, give or take.

2015-07-24 00:00:00 The Philly Fed ADS Business Conditions Index by Jill Mislinski (Article)

The Philly Fed's Aruoba-Diebold-Scotti Business Conditions Index (hereafter the ADS index) is a fascinating but relatively little known real-time indicator of business conditions for the U.S. economy, not just the Third Federal Reserve District, which covers eastern Pennsylvania, southern New Jersey, and Delaware. Thus it is comparable to the better-known Chicago Fed's National Activity Index.

2015-07-24 00:00:00 New Home Sales Decline to 482K by Doug Short (Article)

This morning's release of the June New Home Sales from the Census Bureau at 482,000 was well below general expectations, and the previous month was revised downward. The Investing.com forecast was for 546K. Here is the opening from the report:

2015-07-24 00:00:00 The Median Household Income Declined Fractionally in June by Doug Short (Article)

The Sentier Research monthly median household income data series is now available for June. The nominal median household income was down $60 month-over-month but up $1,250 year-over-year. That's a 0.1% MoM decrease and a 2.3% YoY increase. Adjusted for inflation, the latest income was down $235 MoM and up $1,150 YoY. The real numbers equate to a -0.4% MoM decrease and a 2.1% YoY increase.

2015-07-23 00:00:00 Chicago Fed: Economic Growth Picked Up Slightly in June by Doug Short (Article)

"Index shows economic growth picked up slightly in June": This is the headline for today's release of the Chicago Fed's National Activity Index, and here are the opening paragraphs from the report:

2015-07-23 00:00:00 Tocqueville Gold Strategy Investor Letter: Q2 2015 by John Hathaway of Tocqueville Asset Management

What is required to restore investor interest in gold? In our opinion, a prolonged bout of financial-market adversity would suffice. After all, the cornerstone of coordinated central-bank policy since 2008 has been the levitation of financial assets via Zero Interest-Rate Policy (ZIRP) and Quantitative Easing (QE) by forcing investors into risky assets. We believe that nothing would serve better to undermine confidence in central bankers than a bear market in bonds and equities. The roof above the dollar gold price has been built brick by brick from confidence in central bankers.

2015-07-23 00:00:00 Are MLPs Waiting for Godot? by David Chiaro of Eagle Global Advisors

Like the absurdist play where two characters Vladimir and Estragon wait for a mysterious Godot who never shows up, investors in MLPs continue to wait for definitive answers to the "big questions" facing MLPs: when will interest rates rise and what will happen with future oil production and prices?

2015-07-23 00:00:00 Mid-Year Market Outlook - July 2015 by Team of Thomas White International

At the end of 2014, “why international?” was the prevailing investor sentiment. After all, foreign stocks had lagged U.S. equities yet again, underperforming four out of the five years between 2010 and 2014. The consensus outlook was that U.S. markets would outperform their foreign peers in any case, and so, would it really serve any purpose to hold international equities in a portfolio? Many investors followed the crowd.

2015-07-23 00:00:00 Summer Quarterly Commentary by John Prichard, Miles Yourman of Knightsbridge Asset Management

Greece is much in the headlines again. As we stated in our Spring 2013 letter, “The European debt crisis will not be over until either: 1) the debt goes away (read: default or substantial inflation) or 2) these governments start producing actual surpluses with which to pay the debt down.” So far, every subsequent deal has failed to produce either of these two scenarios, and so each time news media builds up another weekend summit or referendum, the running joke around here is, “Don’t worry, it will all be resolved this weekend.”

2015-07-23 00:00:00 Mid-Year Outlook: Global Economy Likely to Withstand China, Greece by John Calamos, Sr. of Calamos Investments

The global markets and economy should be able to move higher for the remainder of the year, with accommodative monetary policy and well-contained inflation providing tailwinds. The U.S. looks set to extend its not-too-hot, not-too-cold recovery, while Japan is benefiting from stimulus and pro-market reforms. Although economic conditions in Europe remain fragile and uneven, growth looks to be accelerating overall, and we believe the European Union has the tools to prevent a broader Europe contagion should the Greek bailout resolution fall apart.

2015-07-23 00:00:00 Conference Board Leading Economic Index Increased Again in June by Doug Short (Article)

The Latest Conference Board Leading Economic Index (LEI) for June is now available. The index rose 0.6 percent, which follows a 0.8 percent May increase. The latest indicator value came in above the 0.2 percent forecast by Investing.com.

2015-07-23 00:00:00 Understanding the CFNAI Components by Doug Short (Article)

The Chicago Fed's National Activity Index, which we reported on earlier today, is based on 85 economic indicators drawn from four broad categories of data:

  • Production and Income
  • Employment, Unemployment, and Hours
  • Personal Consumption and Housing
  • Sales, Orders, and Inventories

2015-07-23 00:00:00 Kansas City Fed Survey: Manufacturing Less Negative in July by Doug Short (Article)

The Kansas City Fed Manufacturing Survey business conditions indicator measures activity in the following states: Colorado, Kansas, Nebraska, Oklahoma, Wyoming, western Missouri, and northern New Mexico. The latest index came in at -7, which indicates slowing activity. Here is a snapshot of the complete Kansas City Fed Manufacturing Survey. The three-month moving average, which helps us visualize trends, is at its lowest level since mid-2009.

2015-07-22 00:00:00 FHFA House Price Index Rose 0.4% in May by Doug Short (Article)

The Federal Housing Finance Agency (FHFA) has released the U.S. House Price Index (HPI) for the most recent month. U.S. house prices rose in May, up 0.4 percent on a seasonally adjusted basis from the previous month. Year-over-year the index is up 5.7% (nonseasonally adjusted). Investing.com had forecast a 0.5 percent MoM increase.

2015-07-22 00:00:00 The BOJ’s Policy: What’s Next, More Easing? Or Something Else? by Tomoya Masanao of PIMCO

Investors are now debating what the next step will be for the Bank of Japan. It is a dramatic turn, isn’t it? Earlier this year, the consensus view was that the BOJ would move forward with additional easing – the question was ‘when’, not ‘if’.

2015-07-22 00:00:00 Why the Greek Deal Will Work by Anatole Kaletsky of Project Syndicate

Most economists and political commentators believe that the latest Greek bailout was little more than an analgesic. It will dull the pain for a while, but the euro’s problems will metastasize, with a dismal prognosis for the single currency and perhaps the EU as a whole. But the conventional wisdom is likely to be proved wrong.

2015-07-22 00:00:00 Corporate Earnings Outlook: Why Are Expectations so Low? by Tom West of Columbia Threadneedle

Corporate reporting for the second calendar quarter started last week with a lead group of early reporters. Looking forward to the body of earnings season, I think results are likely to be, on average, a bit soft. And despite valuations that are on the high side relative to history, it just doesn’t seem that expectations are that high. In many industries, investors seem willing to accept that better results are shimmering out in the future, provided management teams can make a good case for what they are doing to position the company for that future.

2015-07-22 00:00:00 July 2015 Economic Update by Robert Cron of Bronfman E.L. Rothschild

The U.S. economy continues to plod its way forward at a slow and steady pace. Short-term setbacks seem to be the norm, but a general sense of an improving economy is seen through many sectors. The focus on month-to-month indicators has been de-emphasized recently by the scale of global headlines that seems to be driving markets and investor sentiment. Having a steady economic backdrop is very helpful during a period of global challenges.

2015-07-22 00:00:00 Selling (and buying) the Invisible by Jerry Wagner of Flexible Plan Investments

No matter what profession or stage of your career you may be in, everyone is ultimately “selling something.” Whether a teacher, a lawyer, a physician, a plumber, or a high school student applying to colleges, we are all salespeople in one way or the other.

2015-07-22 00:00:00 Mid-Year Commodities Update: Is It Time To Buy? by Saurabh Lele of Loomis Sayles

Commodities have been falling, mainly due to concerns over the Chinese stock market crash, economic turmoil in Greece and the recent Iran nuclear deal. So could this be a good time to buy commodities? Not all of them. Here’s my updated forecast.

2015-07-22 00:00:00 Are Stocks Overvalued? A Survey of Equity Valuation Models by Chris Brightman of Research Affiliates

In the latest piece from Research Affiliates, Chris Brightman, Chief Investment Officer, revisits the most commonly used equity valuation tools, comparing their respective strengths and weaknesses—and no metric is without its shortcomings. He explains Research Affiliates' approach to valuation, combining both absolute value and relative value. No matter the measurement, U.S. equity prices are high and long-term expected returns are low.

2015-07-22 00:00:00 Quarterly Review and Outlook Second Quarter 2015 by Van Hoisington, Lacy Hunt of Hoisington Investment Management

From the cyclical monthly high in interest rates in the 1990-91 recession through June of this year, the 30-year Treasury bond yield has dropped from 9% to 3%. This massive decline in long rates was hardly smooth with nine significant backups.

2015-07-22 00:00:00 Currencies Depend on Faith, Gold Doesn’t by Peter Schiff of Euro Pacific Capital

In his July 17th Blog, Let's Get Real About Gold, author and Wall Street Journal columnist Jason Zweig likened investor interest in gold with the "Pet Rock" craze of the 1970's, when consumers became convinced that a rock in a box would provide continuous companionship, elevate their social standing, and give them something hip to talk about at parties. Zweig asserts that investor faith in gold, which he argues is just another inert mineral with good marketing, is similarly irrational, and has kept people from putting money in the much more lucrative stock market.

2015-07-22 00:00:00 Who's Right - Commodities Or Fed? by Lance Roberts of Streettalk Live

I have been suggesting for quite some time that the Federal Reserve is stuck in a "liquidity trap" which makes it very difficult for monetary policy to be effective. More importantly, beginning in January of this year, I have suggested that the Fed is being forced to choose between the "lesser of two evils."

2015-07-22 00:00:00 Bond Market Liquidity: Don’t Confuse Investment Risk With Systemic Risk by Douglas Hodge of PIMCO

It is not surprising that the subject of bond market liquidity has come under increasing focus among regulators, investors and the media. While banks are now better capitalized, the combination of post-crisis capital and liquidity regulations and a lower return environment has made them less able and less inclined to function as market makers. Although bank-oriented regulation has made the system more resilient and less levered, it has also had the practical effect of reducing liquidity in markets that have historically relied on banks to support trading, such as in the corporate bond market.

2015-07-22 00:00:00 Global Economic Outlook by Carl Tannenbaum of Northern Trust

Economists and the financial markets have been almost exclusively focused on events in Greece and China over the past several months. These situations merited attention but pushed more-positive economic developments into the background.

2015-07-22 00:00:00 The Upside to Low Liquidity Bond Markets by Multisector Full Discretion Team of Loomis Sayles

As structural and cyclical factors reduce bond market liquidity, the Multisector Full Discretion team explains how they are positioning portfolios.

2015-07-22 00:00:00 Bottom Pick These Commodity ETFs At Your Own Risk by Eric Bush of GaveKal Capital

Last week Bryce highlighted that commodities continue to get decimated and this post prompted a question: should the contrarian investors out there start taking a closer look at commodities? The short answer is investors are much better off keeping their capital in the equity market rather than trying to scoop up a few commodity ETFs.

2015-07-22 00:00:00 Interpreting Active Share by Jon Eggins of Russell Investments

Russell Investments’ Jon Eggins looks at misconceptions around active share.

2015-07-22 00:00:00 Existing-Home Sales Highest in Eight Years by Doug Short (Article)

This morning's release of the June Existing-Home Sales shows the highest sales in eight years to a seasonally adjusted annual rate of 5.49 million units from a slight downward revision of 5.32 million in May (previously 5.35 million). The Investing.com consensus was for 5.40 million. The latest number represents a 3.2% increase from the previous month and a 9.6% increase year-over-year.

2015-07-21 00:00:00 Vehicle Miles Traveled: The Latest Look at Our Evolving Behavior by Doug Short (Article)

The Department of Transportation's Federal Highway Commission has released the latest report on Traffic Volume Trends, data through May.

"Travel on all roads and streets changed by 2.7% (7.3 billion vehicle miles) for May 2015 as compared with May 2014." The less volatile 12-month moving average is up 0.19% month-over-month and 2.84% year-over-year. If we factor in population growth, the 12-month MA of the civilian population-adjusted data (age 16-and-over) is a smaller change, up 0.11% month-over-month and up only 1.68% year-over-year.

2015-07-21 00:00:00 The Big Four Economic Indicators: Industrial Production by Doug Short (Article)

Earlier today the Federal Reserve released its annual revisions to Industrial Production. Prior to the revisions, Industrial Production had risen 26.2% since the end of the Great Recession in June 2009. The revisions trim the rise to 22.8%. The indicator is -0.74% off its nominal high in December of last year, down from -0.55% before the revisions.

2015-07-21 00:00:00 Do The Gabelli Funds Add Value for Investors? by Larry Swedroe (Article)

Mario Gabelli is one of the highest paid executives in America, having earned $88.5 million in 2014 – more than the leaders of all other publicly traded asset-management firms. But have the investors in his mutual funds been as richly compensated when compared to what they would have earned in comparable, passively managed funds?

2015-07-21 00:00:00 New Research to Make Meetings More Productive by Dan Richards (Article)

All advisors want their meetings to be productive – resulting in deeper relationships and buy-in to your recommendations from clients, open conversations with prospects about their needs and honest discussions about how you can help. An email from an advisor last week pointed to research from commercial pilots and surgeons that can make your meetings a better use of your time.

2015-07-21 00:00:00 The Opportunity in Municipal Closed-End Funds The Value in the 9th Inning of the Great Bond Rally by Michael Lebowitz (Article)

For the last five years, bond market experts have unfailingly and wrongly predicted a rise in interest rates. If the current rate-hike fears prove unfounded again, municipal-backed closed-end funds (M-CEFs) is an asset subclass likely to perform well. Here are eight such funds to consider.

2015-07-21 00:00:00 How to Use a Prospect’s Biases to Your Advantage by Daniel Solin (Article)

Jiu-jitsu is a gentle art. Instead of meeting force with greater force, skilled practitioners use their opponent’s force against them. Advisors can learn a lot from this principle.

2015-07-21 00:00:00 What is the Best Portfolio Size for Value Investing? by John Alberg and Michael Seckler (Article)

Many traditional value investors have concentrated portfolios of less than 50 names. Many index funds that tilt toward value factors have portfolios that consist of hundreds of names. This begs the question: What is the best portfolio size for value investing?

2015-07-21 00:00:00 Intergenerational Wealth Transfer – How to Preserve Your Family’s Hard Work by Cary Williams (Article)

Money, religion and politics – the trifecta of inappropriate discussion topics that destroy dinner party conversations. But what about family issues? When client families discuss what they want to achieve with their wealth, equally unsettling themes may arise.

2015-07-21 00:00:00 Four Principles for Proven Success on Social Media by Beverly Flaxington (Article)

In last week’s article, I discussed the need for advisors to use social media effectively. This brought a number of follow-up questions. This week’s column provides guidelines for navigating the often-murky waters of social-media marketing.

2015-07-21 00:00:00 U.S. Housing: Building Strength by Milton Ezrati of Lord Abbett

Even with an expected rise in interest rates, the sector should see a faster pace of growth—not enough, however, to give a major boost to the overall economy.

2015-07-21 00:00:00 Very Weak Strong Closes by Jennifer Thomson of GaveKal Capital

Earlier this year, we took an in depth look at our Strong Close and Weak Close Indicators (details here). An updated look at those charts reveals the number of strong closes for the S&P 500 has continued to decline since the beginning of the year and is currently at levels not seen since 2012.

2015-07-21 00:00:00 Searching for Natural Hedges Against Interest-Rate Risk by Eric Takaha of Franklin Templeton Investments

We have found that historically over time, interest-rate moves don’t often play as large of a role in a broadly diversified fixed income portfolio as one might think.

2015-07-21 00:00:00 Secular Outlook: Implications for Asia-Pacific Investors? by Eric Mogelof, Alan Isenberg of PIMCO

We hope you have had the opportunity to review the summary from our secular forum in May: “The New Neutral Revisited,” written by PIMCO’s Group CIO Dan Ivascyn, Global Fixed Income CIO Andrew Balls an?d Global Strategic Advisor Rich Clarida. In this analysis, the authors identify the six key themes that emerged from our discussion, as well as six risks.

2015-07-21 00:00:00 Jobs, Inflation, and Wage Pressures by Scott Brown of Raymond James

In her monetary policy testimony to Congress, Fed Chair Janet Yellen made it clear that the central bank remains on track to begin raising short-term interest rates later this year. However, she gave herself an out, indicating that Federal Reserve officials’ projections of the federal funds rate are “based on the anticipated path of the economy, not statements of intent to raise rates at any particular time.”

2015-07-21 00:00:00 Markets Show Life While Consumers Hold Back by Russ Koesterich of BlackRock

BlackRock Global Chief Investment Strategist Russ Koesterich discusses why consumer spending remains sluggish, and what it means for the market.

2015-07-21 00:00:00 Jason Zweig Is Wrong About Gold by Roger Nusbaum of AdvisorShares

Jason Zweig’s latest post is titled Let’s Be Honest About Gold: It’s A Pet Rock and attempts to debunk most of the reasons people own gold but oddly skips over the one I believe to be most important and is still wholly intact.

2015-07-21 00:00:00 The Four Totally Bad Bear Recoveries: Where Is Today's Market? by Doug Short (Article)

This chart series features an overlay of the Four Bad Bears in U.S. history since the market peak in 1929. They are:

  1. The Crash of 1929
  2. The Oil Embargo of 1973
  3. The 2000 Tech Bubble bust and,
  4. The Financial Bubble and Crisis.

2015-07-20 00:00:00 Two-Tier Markets, Full-Cycle Investing, and the Benefits and Costs of Defense by John Hussman of Hussman Funds

“The Nifty Fifty appeared to rise up from the ocean; it was as though all of the U.S. but Nebraska had sunk into the sea. The two-tier market really consisted of one tier and a lot of rubble down below. What held the Nifty Fifty up? The same thing that held up tulip-bulb prices long ago in Holland - popular delusions and the madness of crowds. The delusion was that these companies were so good that it didn't matter what you paid for them; their inexorable growth would bail you out.” Forbes Magazine during the 50% market collapse of 1973-74

2015-07-20 00:00:00 US Equity and Economic Review For the Week of July 13-17; Earnings Season Begins, Edition by Hale Stewart of Hale Stewart

The Federal Reserve issued two important documents last week: the Beige Book and Chairperson Yellen’s latest Congressional testimony. The Beige Book was largely positive. Non-financial service growth is moderate. Real estate is growing and the employment picture was generally positive. Strong demand for autos sales helped increase consumer spending. The only negative was manufacturing which was uneven due to the strong dollar and weak energy sector.

2015-07-20 00:00:00 On My Radar: Black Widow Returns by Steve Blumenthal of CMG Capital Management Group

“When it does happen, it’s usually not the first-derivative event that people are caught off guard by. They’re caught off guard by the second, third and fourth derivative events. It’s ‘Oh yeah, when interest rates go up, that happens.”– Gary Cohn, Goldman Sachs’ President and COO

2015-07-20 00:00:00 Iranian Oil to Fuel Further Price Drop? by Norman MacDonald of Invesco Blog

As part of the intensely negotiated nuclear agreement with Iran announced on July 14, Western financial and economic sanctions in place since 2011, including an oil embargo imposed on Iran by the US and the European Union, will be lifted. With a deal, known as the Joint Comprehensive Plan of Action (JCPOA), in the rearview mirror, observers are questioning the return of Iranian oil to the world market: When will it happen, and how much will it be?

2015-07-20 00:00:00 Release the Condor! by Jeffrey Saut of Raymond James

A long time ago in a galaxy far, far away, there was an advertising company trying to come up with a video commercial to introduce Buick’s new car. After a number of the ad company’s proposals were turned down, they came up with the idea of the car cruising on a road down the side of a mountain with an eagle superimposed flying over it. Buick loved it! There was, however, one problem; you cannot capture, or tame, an eagle. Therefore it was decided to use a condor.

2015-07-20 00:00:00 Muni CEFs & Interest Rates by (Article)

With a potential interest rate hike looming, John Cole Scott of CEF Advisors shares a perspective for investors in national municipal bond CEFs.

2015-07-20 00:00:00 Equities Rise as the Focus Returns to Fundamentals by Robert Doll of Nuveen Asset Management

U.S. equities experienced their largest one-week gain since late March last week, with the S&P 500 Index rising 2.4%. Much of the gain came from an easing of Greece’s debt problems and a calming of volatility in China’s equity market. In both cases, policymakers achieved some breathing room, but fundamental issues remain. Greece must still engage in some serious structural reforms and the Chinese economy is still experiencing a significant slowdown.

2015-07-20 00:00:00 Shopping for Bargains in Russian Retailers by Henry D'Auria, Justin Moreau of AllianceBernstein

Russian equities are among the cheapest in the world amid political and economic controversy. Yet investors might be surprised to discover that the rapidly developing retail industry offers undervalued opportunities with attractive return potential.

2015-07-20 00:00:00 Tax Cuts on the Horizon by Brian Wesbury, Bob Stein of First Trust Advisors

The one key reason for being bullish on equities the past several years has been valuation. Stocks are cheap based on profits and interest rates.

2015-07-20 00:00:00 Understanding “Liquidity” by Payson Swaffield of Eaton Vance

In the U.S., the consumer economy is strengthening, while the industrial economy continues to struggle. What does it mean for equities?

2015-07-20 00:00:00 5 Reasons Puerto Rico Is in Debt Trouble by Kristina Hooper of Allianz Global Investors

Kristina Hooper, US Investment Strategist for Allianz Global Investors, breaks down the key drivers that have led to a mounting debt crisis in Puerto Rico—one that, in some ways, rivals what has happened in Greece.

2015-07-20 00:00:00 Secular Trends in Residential Building Permits and Housing Starts by Doug Short (Article)

Over the long haul the two series offer a compelling study of trends in residential real estate. Here is an overlay of the two series since the 1959 inception of the Starts data and the Permits data, which began being tracked a year later. The monthly data points are preserved as faint dots. The trends are illustrated with 6-month moving averages of data divided by the Census Bureau's mid-month population estimates.

2015-07-20 00:00:00 NYSE Margin Debt: Up 1.2% over the Previous Month by Doug Short (Article)

Note: The NYSE has released new data for margin debt, now available through June. We've updated the charts in this commentary to include the latest numbers.

The NYSE margin debt data is about a month old when it is published. The latest debt level is up 1.2% month-over-month. Real (inflation-adjusted) debt rose 0.82% month-over-month and is 1.3% off its record high two months prior in April.

2015-07-19 00:00:00 Imperial Germany by Bill O’Grady of Confluence Investment Management

Last week, we analyzed the Greek/Eurozone negotiations using game theory as an explanatory tool. In this report, we will review the basic geopolitics of Europe, the political response and the evolution of the Eurozone. Using this background, we will examine Germany’s actions in the most recent Greek crisis. As always, we will conclude with market ramifications.

2015-07-19 00:00:00 How US Equity Valuations Have Changed Since 2008 by Eric Bush of GaveKal Capital

The average price to cash flow multiple for a US equity is currently 16.9x. However, as is always the case in a diversified market, the range of valuation multiples varies quite a bit if we break out companies by industry group. The cheapest industry group is utilities currently trading at 7x cash flow. Only two other industries, energy and telecom, are trading below 10x cash flow. On the other end of the spectrum, four companies are trading above 20x cash flow and one, pharma, biotech and life sciences, are trading above 30x.

2015-07-17 00:00:00 More Evidence of China Slowing Permeating Asia – 7/16/2015 by Bryce Coward of GaveKal Capital

Yesterday saw a few more weaker data points out of Australia and South Korea that are worthy of mention. Namely, Australian consumer confidence dropped again to around the lowest it’s been since 2009 and South Korea unemployment remained at its cycle highs. No matter what the top line China GDP number was, there is no doubt that China is on a structurally slower growth trajectory and this is most definitely affecting its closest neighbors.

2015-07-17 00:00:00 Eurozone Looks to Heal Its Greek Crisis Rifts by David Zahn of Franklin Templeton Investments

Bringing eurozone countries closer together will be the focus of the region’s leaders for the next couple of years. So, if we have another crisis in the region, hopefully this drawn-out, painful scenario isn’t repeated.

2015-07-17 00:00:00 How Much Bond Duration Could You Endure? by Chuck Carnevale of F.A.S.T. Graphs

In my most recent article titled “Designing a Retirement Portfolio That’s Just Right for You” I opined that a retirement portfolio should be designed to meet the individual investor’s specific goals, objectives and risk tolerances. I also suggested that the highest total return is not always the best approach because if the investor needs income to live off of, a focus on a consistent rising income stream makes more sense.

2015-07-17 00:00:00 ProVise Bullets by Team of ProVise Management Group

In just a few short days, the comment period will close on a controversial proposal proffered by the Department of Labor (DOL) which would require virtually all financial advisors to adhere to a fiduciary standard of care when giving clients or prospective clients advice on their retirement plans, including IRAs. Ironically, most Americans believe that the advice that their financial advisor provides is already held to this high standard.

2015-07-17 00:00:00 Tracking the Market with Social Media by Blair Jensen of Trade Followers

I’m starting to see signs that market participants on Twitter are turning from bullish to neutral. This is the first sign of longer term weakness from the Twitter stream that I’ve seen since mid to late 2012. Before the strong rally that started in late 2012 it was common for 7 day momentum to stay below zero for extended periods of time as traders were accustom to periodic corrections. The lack of a decline greater than 10% in since then has kept 7 day momentum mostly above zero with a few small dips that quickly reverse higher. It seems that we’ve all been conditioned to buy the dip.

2015-07-17 00:00:00 The Future is Already Here by Anthony Valeri of LPL Financial

A good idea of what the future will look like for bond investors is already here. The three-year average annualized total return of the Barclays Aggregate Bond Index, a broad measure of high-quality bond performance, stood at a very modest 1.8% at the end of June 2015. This is an average return, and shorter-term returns have been both higher and lower over the past three years, but it provides an approximation of what investors may expect over a longer time frame.

2015-07-17 00:00:00 Is This the Big One? What to Do in a Financial Crisis by Zachary Karabell of Envestnet

Events in Greece, China’s massive market sell-off, and the temporary shutdown of the NYSE remind us that change and crisis shift the narrative of what today holds and the future portends. Investors may at first want to run for the exit, but the wiser choice may be to stand calmly and let the storm pass.

2015-07-17 00:00:00 Schwab Market Perspective: Slow Summer?! by Liz Ann Sonders, Brad Sorensen, Jeffrey Kleintop of Charles Schwab

Summer is supposed to be a time of slow trading, light news, and an opportunity for vacations. But the past several weeks have been anything but slow. Greece—a country representing 0.38% of the world economy based on gross domestic product (GDP), has dominated attention; China’s recent stock market plunge also dented sentiment among US investors. It’s meant the “running to stand still” characteristic of this year’s first half is persistent. In fact, the first half of the year saw the S&P 500 trade in its narrowest range in history.

2015-07-17 00:00:00 Crude Oil Is the Best-Performing Commodity of 2015 So Far by Frank Holmes of U.S. Global Investors

The widest expansion this year was made by none other than crude oil, the worst-performing commodity of 2014. As of June 30, oil posted gains of over 11 percent, rising to $59.47 per barrel. After falling more than 50 percent since last summer, though, it had little else to go but up. That oil claimed the top spot just highlights the reality that commodities are in a depressed state right now.

2015-07-17 00:00:00 Will the Selloff in China Hurt the Global Economy? by Russ Koesterich of BlackRock Investment Management

Russ explains why volatility in China's stock market is unlikely to have a material impact on either the global or Chinese economy.

2015-07-17 00:00:00 Europe Needs to Form a More-Perfect Union by Carl Tannenbaum of Northern Trust

Mario Draghi, ECB president, observed this week that Europe is an imperfect union. Flaws and gaps in treaties must be filled by trust among members. Having failed to follow the dictates of past bailout programs, the Greeks lost the trust of their eurozone partners and will now be subject to very close fiscal oversight.

2015-07-17 00:00:00 International Economic Week in Review: Kicking the Greek Can Down the Road, Edition by Hale Stewart of Hale Stewart

Obviously, the big news this week was the Greek deal. This only delayed the inevitable. The plan calls for additional austerity measures, which have been completely ineffective. Greek unemployment is over 25%; the economy is in the middle of a depression, and the debt/GDP ratio increased from 105% in 2008 to 177% currently. The country will simply continue on this path for the foreseeable future, leading to another inevitable conflict with the lending troika. The ECB also issued its policy statement this week, which kept rates unchanged.

2015-07-17 00:00:00 Northern Trust Perspective by Jim McDonald of Northern Trust

Last month we said that the odds favored some sort of “kick the can down the road” agreement between Greece and its creditors, and it looks like that may be coming to pass. While there’s still much work to be done, the tone of the current agreement seems focused on avoiding a euro exit and debt write-downs, while ignoring growth-oriented policies. With the hard decisions yet again put off for another day, this should be euro-weakening, all else equal.

2015-07-17 00:00:00 China's Rebalancing Continues by Andy Rothman of Matthews Asia

The rebalancing of China’s economy continued in the second quarter of this year, as services and consumer spending drove more growth than industry and construction. The inevitable deceleration of most year-on-year (YoY) growth rates also continued, but a booming stock market provided a temporary lift to headline GDP growth.

2015-07-17 00:00:00 ECRI Weekly Leading Index: "Recoveries Remain Resilient" by Doug Short of Advisor Perspectives (dshort.com)

ECRI currently features an article suggesting that concern over negative trend growth is no reason to panic. Recession is not imminent as we are not yet in a "window of vulnerability." The article also discusses Spain's recent cyclical upturn and warns that one shouldn't assume that a cyclical upturn also means positive long-term trend growth. The overall message is not to "fret about recession just yet".

2015-07-17 00:00:00 Productivity and Modern-Day Horse Manure by John Mauldin of Mauldin Economics

What exactly do we mean by this “productivity” word? I’ve given this a good deal of thought lately, and I plan to explore it in my newsletters over the next few months. As you will see, productivity growth has both a positive side and a very negative side.

2015-07-17 00:00:00 If the Fed Raises Policy Interest Rates in 2015, It's Likely to Be One and Done by Paul Kasriel of Econtrarian, LLC

Last week, Fed Chairperson Yellen indicated that the Fed was likely to raise its policy interest rates sometime before year end. Given the behavior of the sum of commercial bank credit and depository institution reserves at the Fed in the past three quarters, it is a mystery to me why the Fed would be contemplating a policy interest rate increase at this juncture. But if this is something the Fed just has to get out of its system, then the first increase is unlikely to be followed by a second interest rate increase for some time.

2015-07-17 00:00:00 The Big Four Economic Indicators: Weak June Real Retail Sales by Doug Short (Article)

Nominal Retail Sales in June fell -0.27%, and the two previous months were revised downward from 1.21% in May to 1.03% and from 0.24% to 0.03% in April. June Real Retail Sales, calculated with the seasonally adjusted Consumer Price Index, came in at -0.59% month-over-month. This was the fifth monthly decline over the past seven months. The chart below gives us a close look at the monthly data points in this series since the end of the last recession in mid-2009. The linear regression helps us identify variance from the trend.

2015-07-17 00:00:00 Inflation: An X-Ray View of the Components by Doug Short (Article)

Here is a table showing the annualized change in Headline and Core CPI, not seasonally adjusted, for each of the past six months. Also included are the eight components of Headline CPI and a separate entry for Energy, which is a collection of sub-indexes in Housing and Transportation. We can make some inferences about how inflation is impacting our personal expenses depending on our relative exposure to the individual components.

2015-07-17 00:00:00 Understanding Secular Trends in Inflation by Doug Short (Article)

The Consumer Price Index for Urban Consumers (CPI-U) released this morning puts the year-over-year inflation rate at 0.12%. It is substantially below the 3.84% average since the end of the Second World War and its 10-year moving average, now at 2.14%.

2015-07-17 00:00:00 June Consumer Price Index: Year-over-Year Core at 1.8% by Doug Short (Article)

The Bureau of Labor Statistics released the June CPI data this morning. The year-over-year unadjusted Headline CPI came in at 0.12% (rounded to 0.1%), up from -0.04% (rounded to 0.0%) the previous month. Year-over-year Core CPI (ex Food and Energy) came in at 1.76% (rounded to 1.8%), up fractionally from the previous month's 1.72% (rounded to 1.7%). Here is the introduction from the BLS summary, which leads with the seasonally adjusted monthly data:

2015-07-17 00:00:00 What Inflation Means to You: Deconstructing the Consumer Price Index by Doug Short (Article)

Let's do some analysis of the Consumer Price Index, the best known measure of inflation. The Bureau of Labor Statistics (BLS) divides all expenditures into eight categories and assigns a relative size to each. The pie chart below illustrates the components of the Consumer Price Index for Urban Consumers, the CPI-U, which I'll refer to hereafter as the CPI.

2015-07-17 00:00:00 New Residential Housing Starts Above Forecast for June by Doug Short (Article)

The U.S. Census Bureau and the Department of Housing and Urban Development have now published their findings for June new residential housing starts. The latest reading of 1.17M was above the Investing.com forecast of 1.10M.

2015-07-17 00:00:00 New Residential Building Permits Highest Since 2007 by Doug Short (Article)

The U.S. Census Bureau and the Department of Housing and Urban Development have now published their findings for June new residential building permits. The latest reading of 1.343M was well above the Investing.com forecast of 1.150M.

2015-07-16 00:00:00 U.S. Economy Slouches toward Recession as Eurozone Crisis Widens by Stefan Gleason of Money Metals Exchange

Federal Reserve chair Janet Yellen may have missed her window of opportunity to raise interest rates. The economic data no longer paint a picture of even a tepid recovery. Since the start of the year, key indicators for the economy began pointing toward recession.

2015-07-16 00:00:00 Sometimes Waterfalls Aren’t Beautiful by Jerry Wagner of Flexible Plan Investments

Over 25 years ago I took my family (my wife, Pat, and two sons, Michael and David) to the big island of Hawaii. It was a dream comes true. We’d been to Honolulu, Kauai, and Maui, but not to the Big Island. Our family spent two weeks in a car circumnavigating the isle on our own. It was a joy not to be forgotten. Early on in our trip, it became apparent that the major island attractions (after the live volcano that is) were the waterfalls. We seemed to race from one waterfall to another as we circled the island.

2015-07-16 00:00:00 Market Overview Q215 by David Robertson of Arete Asset Management

Massive interventions by central banks over the last several years have created a “game of Chicken” that has fundamentally changed investing into an exercise that more closely resembles gambling. Until the game resolves investors will do well to recognize this “game” as largely unwinnable and await better opportunities later.

2015-07-16 00:00:00 How Environmental Factors Affect Airlines’ Cost Structures by Kim Nguyen-Taylor and Mauricio Agudelo of Calvert Investment Management

The airline industry exemplifies the materiality of sector-specific environmental, social and governance (ESG) factors on credit drivers of spread performance. We remain bullish on the industry and we will look to opportunistically increase exposure in certain fixed-income investments in the near term. We continue to favor newer deals that are backed by younger, more energy-efficient and modern fleets. We believe the impact of these environmental factors on an airline company’s bottom line is quite direct.

2015-07-16 00:00:00 Q2 Earnings Preview by Burt White of LPL Financial

Q2 earnings season could potentially look a lot like Q1. The Thomson-tracked consensus is calling for a 3% year-over-year decline in S&P 500 earnings for the second quarter, dragged down once again by the energy sector and a strong U.S. dollar.

2015-07-16 00:00:00 Quarterly Letter – July 2015 by Ron Muhlenkamp, Jeff Muhlenkamp of Muhlenkamp & Company, Inc.

Ron and Jeff Muhlenkamp discuss their observations of domestic and global economic activity and the impact it has on the markets.

2015-07-16 00:00:00 A Close Look at Trends in Employment for 13 Age Groups by Doug Short (Article)

The columns in the adjacent chart are arranged by age group from left to right. Teen employment is down 56% while at the opposite end, employment of the 75+ age group is up 121%. The stair steps in between are a clear indication of the aging workforce over this time frame.

2015-07-16 00:00:00 China: Searching for a New Equilibrium by Michael Hasenstab of Franklin Templeton Investments

Overall, based on our detailed analysis, we believe China will remain on course … while the economy shifts toward consumption, services and higher value-added manufacturing. This could have important implications for the global economy.

2015-07-16 00:00:00 Balancing Your Bond Portfolio’s Risk and Reward by Alison Martier of AllianceBernstein

Most participants in our Global Income Study told us they wanted income to be high and stable. We think it’s possible to build a bond portfolio that strikes a balance between both—provided investors are willing to take some risk to do it.

2015-07-16 00:00:00 Navigating Market Signals in Multi-Asset Portfolios by Rob Balkema of Russell Investments

Russell Investments’ Rob Balkema provides insights on how a portfolio manager looking at Japan might use market signals to manage multi-asset class funds.

2015-07-16 00:00:00 Five Portfolio Moves for the Second Half by Russ Koesterich of BlackRock

After a relatively calm few months, market volatility is back. In recent weeks, stocks have swung between ups and downs, as investors have attempted to digest the latest news out of Greece, the recent bear market in China and the growing likelihood that the Federal Reserve (Fed) will hold off on raising rates until after its September meeting.

2015-07-16 00:00:00 NAHB Housing Market Index: Highest Since November 2005 by Jill Mislinski (Article)

The National Association of Home Builders (NAHB) Housing Market Index (HMI) is a gauge of builder opinion on the relative level of current and future single-family home sales. It is a diffusion index, which means that a reading above 50 indicates a favorable outlook on home sales; below 50 indicates a negative outlook.

2015-07-16 00:00:00 Philly Fed Business Outlook: Remains Positive Despite Decline by Jill Mislinski (Article)

The latest gauge of General Activity came in at 5.7, down from last month's 15.2. The 3-month moving average came in at 9.2, fractionally down from 9.8 last month. Since this is a diffusion index, negative readings indicate contraction, positive ones indicate expansion. The Six-Month Outlook was up at 41.5, versus the previous month's 39.7.

2015-07-15 00:00:00 The Mirage of the Financial Singularity by Robert Shiller of Project Syndicate

Many economists and financial-market observers seem to believe that we are approaching the point when even Warren Buffett would be better off leaving all investment decisions to a computer program. How, then, would they explain the recent plunge in China's stock market?

2015-07-15 00:00:00 The National Debt Is Over $18 Trillion, Not $13 Trillion by Gary Halbert of Halbert Wealth Management

In June, the non-partisan Congressional Budget Office (CBO) released its annual “Long-Term Budget Outlook” which concluded yet again that the trajectory of US federal debt is “unsustainable” and will lead to an unprecedented debt crisis in the years ahead.

2015-07-15 00:00:00 Become Like Water My Friend by Jeffrey Saut of Raymond James

I used to love watching the History Channel. Back in the good ole days (which actually weren’t too long ago), it would feature real historical content like documentaries, mini-series, and regular programs dedicated to some of the most interesting moments in which human beings have participated. When nothing else seemed to be on the other 300 stations, I could at least count on the History Channel to help kill a few minutes without killing my brain cells in the process.

2015-07-15 00:00:00 Volatile Estimates in Europe by Jennifer Thomson of GaveKal Capital

Changes in sales and earnings estimates have historically ranked fairly high in our factor analysis– a methodology we employ to gauge which variables have the greatest influence on/ correlation with moves in the overall market.

2015-07-15 00:00:00 China’s Market Correction in Three Easy Charts by Frank Holmes of U.S. Global Investors

The sheer size and importance of China’s equity markets cannot be overstated. Second in size only to the New York Stock Exchange, the combined value of the Asian country’s stock markets is $14 trillion and change. Or at least it was, before they fell 30 percent, wiping away nearly $2 trillion in value. To put this in perspective, the gross domestic product (GDP) of debt-troubled Greece is around $200 billion.

2015-07-15 00:00:00 Tempering Turbulence Along the Glide Path by Daniel Loewy, Christopher Nikolich of AllianceBernstein

Target-date glide paths essentially operate on autopilot. But with greater volatility always popping up on the radar screen, even the best of glide paths can benefit from some tactical maneuvering.

2015-07-15 00:00:00 Greek Games: An Update by Bill O’Grady of Confluence Investment Management

We update our views on the Greek situation using game theory as a theoretical construct. We used a similar construct in an earlier report on Greece but, in light of the referendum and subsequent negotiations, we believe that further clarification is necessary. And so, we will review the “game of chicken,” which we believe best describes this situation. We will then discuss in detail the particular aspects of this game and why it leads to rash and aggressive behaviors in participants.

2015-07-15 00:00:00 How Socialism Destroyed Puerto Rico, and How Capitalism Can Save It by Peter Schiff of Euro Pacific Capital

While Greece is now dominating the debt default stage, the real tragedy is playing out much closer to home, with the downward spiral of Puerto Rico. As in Greece, the Puerto Rican economy has been destroyed by its...

2015-07-15 00:00:00 Trying to Profit from Low Expectations by (Article)

Portfolio Manager Jay Kaplan talks about how he manages risk, the advantages of knowing a company's history well, where he is currently finding value in the small-cap market, portfolio positioning, and more.

2015-07-15 00:00:00 Producer Price Index Remains Negative Year-over-Year, but Seeing Small Increases by Jill Mislinski (Article)

Today's release of the June Producer Price Index (PPI) for Final Demand came in at 0.4% month-over-month seasonally adjusted. That follows the previous month's 0.5% increase. Core Final Demand (less food and energy) came in at 0.3% month-over-month following a 0.1% change the month before. The Investing.com forecasts were for 0.2% headline and 0.1% core. The year-over-year change in seasonally adjusted Final Demand is -0.7%, up from last month's second lowest in the brief history of this data series at -1.0% (the lowest being the -1.3% in April).

2015-07-15 00:00:00 Empire State Manufacturing Conditions Improve Slightly by Jill Mislinski (Article)

This morning we got the latest Empire State Manufacturing Survey. The diffusion index for General Business Conditions at 3.9 (3.86 to two decimals) shows an increase from last month's -2.0, which signals a slight improvement in activity. The Investing.com forecast was for a reading of 3.0.

2015-07-14 00:00:00 GTAA Delivers Solid Returns at Lower Risk. Period. by Adam Butler, Michael Philbrick, Rodrigo Gordillo of BPG & Associates

We recently came across a couple of articles making the sensational claim that TAA is nothing more than a repackaged and dressed-up version of market timing. Both articles – and others, we’ve subsequently learned – point to a Morningstar study showing that TAA has underperformed the Vanguard U.S. 60/40 balanced fund over the past few years. We have several problems with the original study and the referencing posts, but it all boils down to these points of difference.

2015-07-14 00:00:00 Greece: Chaos or Orderly Resolution? by Brent Schutte of BMO Global Asset Management

Greece has found itself in dire financial straits for the last few years (its first bailout was back in 2010), but the situation has become critical in recent weeks. The impetus for this was the election in January 2015 of a radical left government that wished to reopen negotiations with creditors. Much of the response and commentary that we have seen from European politicians and central bankers has been political posturing that has masked the harsh reality: without significant debt restructuring, Greece will never be able to pay back its debts.

2015-07-14 00:00:00 Make Plan Success a Priority for the CFO by Glenn Dial of Allianz Global Investors

Targeting chief financial officers can help advisors get more plan participants to achieve financial wellness, justify their value to plan sponsors and win new business. But you have to speak their language and show them the numbers.

2015-07-14 00:00:00 Our Bipolar Economy by Edward Perkin of Eaton Vance

In the U.S., the consumer economy is strengthening, while the industrial economy continues to struggle. What does it mean for equities?

2015-07-14 00:00:00 Millennial Prosperity by William Smead of Smead Capital Management

Many media organizations and smart money managers are postulating that today’s 22-35 year old age group (millennials) might be the first generation since World War II to not marry, have children, buy cars and buy houses at high enough percentages to help us fully recover from the financial meltdown of 2007-09.

2015-07-14 00:00:00 NFIB: "Small Business Takes Significant Hit in June" by Doug Short (Article)

The latest issue of the NFIB Small Business Economic Trends is out today. The update for June came in at 94.1, a 4.2 point decline from the previous month. The index is now at the 21st percentile in this series. The Investing.com forecast was for 98.6. Here is the opening summary of the news release.

2015-07-14 00:00:00 Common Sense Trumps Smart Beta by Kendall Anderson of Anderson Griggs

Every few years or so the powerful money men of Wall Street come up with a new idea they believe will lead to unimaginable wealth for their clients and themselves. These ideas often stem from rigorous statistical studies which attempt to confirm that a particular idea offers better than average returns to investors. Of course, in the world of academia, any believable idea originally promoted by one researcher will quickly be followed by additional research from academics around the world expanding on, reinforcing, or contradicting the original study.

2015-07-14 00:00:00 Pursuing Yield in a Low-Return Environment by (Article)

Eric Foster of Tennessee-based PYA Waltham Capital discusses which asset classes and funds he uses for retirees seeking income-driven solutions.

2015-07-14 00:00:00 An Update on China from Charlie Awdry by (Article)

Charlie Awdry, Investment Manager in Henderson’s Asia ex Japan equities team, discusses the recent volatility we are seeing in Chinese equity markets. With shares being suspended from trading and further government action expected, this downturn in Chinese equities is causing nervousness among investors in the retail investor dominated Chinese markets.

2015-07-14 00:00:00 Retail Sales: Surprising Drop in June by Jill Mislinski (Article)

The Census Bureau's Advance Retail Sales Report released this morning shows that seasonally adjusted sales in June were down 0.3% month-over-month and up 1.4% year-over-year. Core Retail Sales (ex Autos) came in at -0.1% MoM and 0.1% YoY. The Investing.com forecasts were 0.2% for Headline Sales and 0.5% for Core Sales.

2015-07-14 00:00:00 Fees vs. Commissions: Why An Old Debate Is New Again by Bob Veres (Article)

Robo-advisors are forcing us to revisit the ancient fees versus commissions debate. New data and new circumstances have changed the debate in powerful ways.

2015-07-14 00:00:00 Gundlach v. Yellen: Will the Fed Raise Rates? by Robert Huebscher (Article)

On Friday, Fed Chairwoman Janet Yellen said that the nine-year wait for an interest-rate increase would likely end this year. Three days earlier, though, Jeffrey Gundlach said that a rate increase this year is unlikely, given the mix of bad news and uncertainty in the world markets. Which view prevails will be the focus of bond market participants in the months ahead.

2015-07-14 00:00:00 Olympic Training Techniques that Win Clients by Dan Richards (Article)

Over the past 50 years, advances in training techniques have transformed what it takes for high level athletes to compete. But the application of some of these breakthroughs isn’t just limited to sports. Here’s how a former college athlete who works as a financial advisor used mental training techniques to grow her network and prospect effectively.

2015-07-14 00:00:00 Knowing When to Sell Real Estate Investments by Keith Jurow (Article)

For nearly five years, I have offered compelling analysis that the so-called real estate recovery is an illusion. While this evidence has been largely ignored by Wall Street and the pundits, those who heeded my advice in an earlier article to sell certain REITs (VNO, GGP, SPG) and the ETF IYR fared well.

2015-07-14 00:00:00 Venerated Voices™ Ranks Economic and Market Commentaries Most Read by Financial Advisors by Advisor Perspectives (Article)

Advisor Perspectives, a leading publisher serving financial advisors and the financial advisory community, has announced its Venerated Voices™ awards for commentaries published in Q2 of 2015.

2015-07-14 00:00:00 Innovation – Too Much, or Too Little of a Good Thing? by Michael Lebowitz (Article)

New innovations save us a lot of time and effort but, believe it or not, they do little to generate sustainable economic growth. Sustainable economic growth depends on productivity. Despite these new innovations, domestic productivity is flat lining.

2015-07-14 00:00:00 How to Understand Neuroscience to Gather More Assets by Daniel Solin (Article)

Brokers are largely successful in selling inferior or conflicted services because they have superior sales skills. Bridge this gap and level the playing field by understanding the role that neuroscience plays in the decision-making process.

2015-07-14 00:00:00 How Likely is Hyperinflation in the U.S? Part Two by Seaborn Hall (Article)

My previous article covered hyperinflation's history, process, effects, definition, types and causes. Part Two answers the questions of how to gauge the likelihood of hyperinflation in the U.S., what the emerging dangers are, how it might happen here and how to prepare if it does.

2015-07-14 00:00:00 Can Social Media Lead to New Prospects? by Beverly Flaxington (Article)

We should be getting more from social media. We all have LinkedIn accounts. We have a Twitter account for the firm, and we regularly post articles and ideas. None of this leads to new business. What can we do to generate prospects from our social media activities?

2015-07-14 00:00:00 Correlation Among Stocks, Especially In Europe, Have Shot Higher by Eric Bush of GaveKal Capital

Over the past several weeks, correlations among stocks have been increasing which makes it increasingly difficult for stock pickers to outperform. The most dramatic example of this is happening in Europe.

2015-07-14 00:00:00 Putting the Greece Deal in Context by Russ Koesterich of BlackRock

Now that Greece and its creditors have reached a tentative deal, Russ discusses the two investing themes that are likely to dominate the second half of 2015.

2015-07-14 00:00:00 The View from the Fed by Scott Brown of Raymond James

Federal Reserve Chair Janet Yellen will give her semiannual monetary policy testimony to Congress this week. In the past, this has been an important event for the financial markets. However, Fed communication is a lot more open these days. For example, we have the forecasts of senior Fed officials and the minutes of the June policy meeting in hand. However, there is still scope for financial market participants to learn a bit more.

2015-07-14 00:00:00 Perspectives on China by Nick Niziolek of Calamos Investments

There are considerable opportunities in China for disciplined, fundamentally driven investors. China’s medium- and longer-term secular tailwinds remain intact. Our team continues to encourage investors to look past the short-term noise and remain focused on the longer-term potential. The economic transition that China is attempting is incredibly challenging. Right now, Chinese regulators have taken a kitchen-sink approach. While it hasn’t achieved the desired effect, it affirms the depth of China’s commitment to stabilize its markets.

2015-07-14 00:00:00 Risks from China Overtake Concerns About Greece by Robert Doll of Nuveen Asset Management

U.S. equity volatility spiked last week, driven by escalating concerns over Greece’s debt problems and a sharp volatility in Chinese equities. The Chinese stock market experienced a dramatic sell-off in recent weeks before staging a comeback toward the end of last week. Early last week, the possibility of additional Greek defaults and a potential messy exit from the eurozone intensified. By the end of the week, however, Greek officials and policymakers seemed to be approaching an agreement.

2015-07-14 00:00:00 Greece: Four Fateful Factors by Milton Ezrati of Lord Abbett

While we await the disposition of Greece’s latest fiscal rescue, here are the issues that could influence the nation’s future—bailout or no.

2015-07-14 00:00:00 Weighing the Week Ahead: Will Falling Earnings Sink the Stock Market? by Jeffrey Miller of NewArc Investments, Inc.

There is special interest in 2nd quarter earnings both as a read on the economy and trends in costs and margins. Ordinarily the focus would be Fed Chair Yellen’s House testimony on Wednesday and the reprise on Thursday. She has stated her viewpoint so frequently – rate hike possible, data dependent, expecting better growth – that a surprise is unlikely.

2015-07-13 00:00:00 FlexShares Tilted Indexing Suite by (Article)

See how our trio of tilted index funds gives you the power of investing in the entire global stock market.

2015-07-13 00:00:00 Greece and the King of Asteroid 325 (and The One Lesson to Learn Before a Market Crash) by John Hussman of Hussman Funds

Last week, the price of Greek government debt soared on hopes of an 11th hour stick-save bailout by the European Union. Unfortunately, that price jump still left Greek bonds priced to reflect a default probability of 100% at every maturity. The jump only reflected an increase in the amount that bondholders evidently expect to recover in default, raising the implied recovery rate from the recent low near 30% to something closer to 50%. Put another way, the bond market has fully priced in the likelihood of a default coupled with a major haircut on Greek debt.

2015-07-13 00:00:00 The Invisible Hand Clobbers the Shanghai Market – And the State Intervenes by Joseph Taylor of Loomis Sayles

Anything that goes up as fast as the Chinese stock market was bound to correct. The Shanghai Composite Index value doubled over the last seven months (December 2014 – July 2015) and the rise was not based on brightening fundamentals (the Chinese economy has been slowing for more than a year.)

2015-07-13 00:00:00 US Equity and Economic Review For the Week of July 6-10: The Fed Speaks, Edition by Hale Stewart of Hale Stewart

Aside from two Federal Reserve releases, the only major news announcement was the ISM services index, which printed a very strong 56% headline number. New orders were a bullish 58.3 while employment was 52.7.

2015-07-13 00:00:00 54% of All EM Stocks Are In A Bear Market Even As The MSCI EM Index Is Off Only 7% by Eric Bush of GaveKal Capital

Two weeks ago we noted how more stocks than you might think are in a correction. At that time, 42% of the constituents in MSCI World Index were at least 10% off its 200-day high. As of yesterday, that number has increased to 57%.

2015-07-13 00:00:00 Baby Boomer Employment Across Time by Doug Short (Article)

The 20th century Baby Boom was one of the most powerful demographic events in the history of the United States. We've created a series of charts to show seven age cohorts of the employed population from 1948 to the present. What we see is essentially the "Boomer Bulge" in employment across time. Those born between 1946 and 1964 continue to grow the employment of the two oldest cohorts. It will be interesting to see how long those two trends continue.

2015-07-13 00:00:00 The Black Widow Returns by Richard Bernstein of Richard Bernstein Advisors

Strategies based on stretching for yield have a long history of surprising investors with unanticipated risks.

2015-07-13 00:00:00 CEF Discounts by (Article)

Historically wide discounts present potential opportunity to CEF investors seeking income and “alpha,” says Bryn Torkelson of Matisse.

2015-07-13 00:00:00 On My Radar: High Probability of a Global Recession by Steve Blumenthal of CMG Capital Management Group

Economists have a number of different ways to measure over and under valuation. Most measures currently show an overvalued equity market. Let’s just say the market is expensively priced.

2015-07-13 00:00:00 Politicians Should Stop Giving Investment Advice by Brian Wesbury, Robert Stein of First Trust Advisors

For the past six years, the conventional wisdom has predicted the end of the world. On the left, they say “Tea Party austerity” is a catastrophe and an “income divide” spells doom. On the right, the election of President Obama made collapse inevitable. Anything and everything that could be spun negatively, has been.

2015-07-12 00:00:00 ECRI Weekly Leading Index Continues With Little to No Change by Doug Short of Advisor Perspectives (dshort.com)

ECRI's most recent article suggests that wage inflation does not support the case for a rate increase. "The recent rise in wage inflation, having become an obvious fact, is increasingly being used to support the case for rate hikes – including by Fed Chairman Janet Yellen, who now sees these “tentative signs of stronger wage growth” as a harbinger of inflation."

2015-07-12 00:00:00 The June Unemployment Rate Fell to 5.3%, but ... by Paul Kasriel of Econtrarian, LLC

The simultaneous decline in the unemployment rate and the labor force participation rate is consistent with the notion that the unemployment fell because people dropped out of the labor force due to discouragement over poor job prospects. So, recork the champagne, right? Wrong.

2015-07-11 00:00:00 It’s Not Over Till the Fat Lady Goes on a P/E Diet by John Mauldin of Mauldin Economics

The answer to the seemingly arcane question of whether we are in a secular bull or bear market makes a great difference in the proper positioning of your portfolios. And getting it wrong can have serious consequences.

2015-07-11 00:00:00 Global Investors: You Should Be Paying Attention to this Economic Indicator by Frank Holmes of U.S. Global Investors

In addition to our own macro models, BCA Research , a highly respected independent research company, pointed out that PMIs in developing economies have plunged to new lows. The International Monetary Fund also revised downward its global growth forecast for 2015. On this account, bad news is good news, as central bankers are scrambling to stimulate economic growth.

2015-07-11 00:00:00 Signs the U.S. Recovery is Solid by Rick Rieder of BlackRock Investment Management

Rick Rieder dispels pessimistic evaluations of the U.S. economy, explaining why the U.S. recovery is actually stronger than headline data would have you believe.

2015-07-11 00:00:00 Themes from the First Half of 2015 and Questions for the Second Half by Carl Tannenbaum of Northern Trust

The weekly commentary is a review of current activity in global financial markets, with an emphasis on the U.S. fixed income market.

2015-07-11 00:00:00 China Market Update by Andy Rothman of Matthews Asia

China’s equity markets have steadily declined for weeks, raising a torrent of questions and concerns. Given that China accounts for more global growth than the U.S., Europe and Japan combined, this week Andy Rothman, Investment Strategist at Matthews Asia, answers some of your most pressing questions.

2015-07-11 00:00:00 International Economic Week in Review for July 6-10; It's all Greek to Me, Edition by Hale Stewart of Hale Stewart

Greece is obviously the big story of the week. As of this writing, it appears a compromise might be in play. But this is a very fluid situation, so that could change within an hour. Several weeks ago, I noted that given the massively high unemployment rate and GDP contraction, there is little left for Greece to cut without becoming a failed state. Be that as it may, it appears even more cuts are coming.

2015-07-10 00:00:00 Story of China Still Intact Despite Market Downturn by Mark Mobius of Franklin Templeton Investments

In my view, the bottom line regarding the recent correction in China’s markets is essentially a story of too much euphoria and a natural correction.

2015-07-10 00:00:00 More Evidence of China Slowing Permeating Asia by Bryce Coward of GaveKal Capital

Yesterday and today were host to a few more macro data points all signaling basically the same thing – a synchronized slowdown in Asia which appears to be driven by China. In the five charts below we show that Chinese CPI remains anemic while PPI just made a new cycle low, Australian unemployment ticked up, Japanese bank loans appear to be topping/rolling over, the Japanese economy watchers survey is rolling over, and Japanese machinery orders excluding ships keeps weakening.

2015-07-10 00:00:00 Greece’s Precarious Position by Norman Boersma, Cindy Sweeting, Heather Arnold of Franklin Templeton Investments

Given how fluid this situation is currently, attempting to assign probabilities to a Greek exit scenario remains a moving target on a daily basis.

2015-07-10 00:00:00 China Has Tools to Manage Stock Sell-Off by Anthony Chan, Stuart Rae of AllianceBernstein

Chinese equities are undergoing a sharp correction, and the volatility could last for some time. But we think policymakers have both the tools and the resolve to support the broader Chinese economy.

2015-07-10 00:00:00 Volatility as an ‘Opportunity Class’ by Rick Chan of PIMCO

Is volatility an asset class? It’s a question we often debate, internally and with clients. There’s no simple answer. Either way, though, it’s an academic point that matters less than our belief that volatility is an “opportunity class” – one with a variety of tactical and macro implications.

2015-07-10 00:00:00 China Market Update by Andy Rothman of Matthews Asia

China’s equity markets have been in steady decline for several weeks, raising a lot of questions about the potential impact on the world’s second-largest economy. Given that China accounts for more global growth than the U.S., Europe and Japan combined, this is an important topic for investors.

2015-07-10 00:00:00 Millennials Lead: Today’s Largest Generation Will Impact U.S. Economy and Markets by Michael Avery, Philip Sanders of Ivy Investment Management Company

When thinking of the U.S. millennial generation, many of us may imagine a carefree teenager. In reality, the leading edge of the Millennials is in its mid-thirties and establishing careers and families. They are establishing homes, settling down and engaging in decisions about how to spend and invest their money. We think the rise of the Millennials is likely to have a significant effect on the economy and provide a catalyst for new investment opportunities.

2015-07-10 00:00:00 What Do High-Yield Maturities Tell Us About Timing the Credit Cycle? Another Take on the Wall by Ara Lovitt of GMO

Not only did the maturity wall tell investors to be complacent right before the market was about to sell off, it told investors to be more cautious just as the market was about to rebound. The point is not that debt maturities are irrelevant. Rather, based on the experience of the last three credit cycles, there seems to have been much larger forces at work that ultimately caused the cycle to turn. From the perspective of an investor trying to formulate a high-yield outlook, it seems to GMO that focusing too much on the maturity wall is probably unhelpful.

2015-07-10 00:00:00 Is This the Big One? What to Do in a Financial Crisis by (Article)

If it seems we've focused on crises for years, that's because we have. Are the events of the past few weeks simply another temporary shock to the global financial system, or indicative of something much bigger?

2015-07-10 00:00:00 Greek Referendum: Definitive Vote Ushers in Further Uncertainty by Rob Waldner, Mark Nash of Invesco Blog

Greek voters sent a definitive message Sunday, July 5. They said “no” to further austerity measures required for additional bailout aid from the European Union (EU). In a 60/40 vote, Greek voters rejected EU reforms and entitlement cuts required for a new EU funding program. But according to exit polls, the referendum did not appear to be a vote to leave the euro.

2015-07-10 00:00:00 Designing a Retirement Portfolio That’s Just Right For You by Chuck Carnevale of F.A.S.T. Graphs

No one knows your own personal financial situation better than you do. Every individual possesses their own unique investment goals, objectives, needs and risk tolerances. At first glance this may seem simple and straightforward to the point of stating the obvious. However, I contend that the reality that individuals have different financial situations, goals and objectives is profoundly important as it relates to designing an appropriate retirement investment portfolio.

2015-07-09 00:00:00 Treasury Snapshot: A Look at Recent Volatility by Doug Short (Article)

US Equity indexes have had a volatile week so far, with chronic Grexit tensions being trumped by anxieties over the deflating bubble in Chinese equities. Treasury yields have shared in the volatility. The closing yield on the 10-year note has had a 27 basis-point range over the last nine sessions: 2.49% on June 26 to 2.22% at yesterday's close, which was 10 bps below today's close.

2015-07-09 00:00:00 Greece Playbook by Burt White of LPL Financial

Greece’s critical referendum took place this weekend and the Greek people resoundingly voted “no”?—?rejecting the latest bailout deal from creditors. The referendum result, which some interpreted as a vote to exit the Eurozone, throws Greece’s future in the currency union firmly in doubt. The unexpected result has led to a roughly 2% decline in the broad European indexes but only a modest decline in the S&P 500 (as of 3 p.m. ET today, July 6, 2015). The negative market reaction in Europe is not surprising, given polls heading into the weekend suggested a vote for the bailout was

2015-07-09 00:00:00 Greece: Closer to the Brink by Carl Tannenbaum, Victoria Marklew of Northern Trust

Greek voters declared an overwhelming “no” on Sunday – by a margin of 61% to 39%. Whether they were rejecting the notion of reform for aid or perceived German bullying is not clear, but the message to the rest of Europe was clear.

2015-07-09 00:00:00 China Reveals The Perils Of Leverage by Lance Roberts of Streettalk Live

I have, on more than one occasion, discussed the surging levels of margin debt in the U.S. markets. These discussions were met by opposing points of view suggesting that margin debt doesn't matter.

2015-07-09 00:00:00 Range-Bound ?? by Jim Tillar, Steve Wenstrup of Tillar-Wenstrup Advisors

In spite of an increase in daily volatility the stock market has been stuck in a tight trading range this year. There has been a lot of huffing and puffing with markets going nowhere until very recently. Many stock indices were down for the quarter, some only positive due to their dividends and have returned less than 2% in 2015. The biggest action was a reversal in interest rates as investors anticipated the Fed raising interest rates later this year.

2015-07-09 00:00:00 While Attention Has Been On China, EM Latin America Keeps Taking It On The Chin by Eric Bush of GaveKal Capital

EM Latin America stocks are by far the worst performing stocks in the world this year. So even though all eyes are on China at the moment, as Bryce recently pointed out, the Chinese stock market doesn’t matter much for non-Chinese investors.

2015-07-09 00:00:00 Five Questions on Risk in Concentrated Equities Today by Mark Phelps, Dev Chakrabarti of AllianceBernstein

As equity markets cope with fresh volatility from China to Europe, managing risk is a top priority. In our view, concentrated portfolios stand up to scrutiny on risk—even in today’s complex market conditions.

2015-07-09 00:00:00 Opportunity Set in Private Lending to Remain Robust by John Howe of Old Hill Partners

The U.S. economic environment continues to be ideal for asset-backed lending, according to a new research report from Old Hill Partners Inc.

2015-07-09 00:00:00 CIO Newsletter by Ritesh Jain of Tata Asset Management

In this edition of my newsletter, I have tried to address one of the most common questions that investors have been asking me these days; what to make of the noise surrounding us and how India is placed to weather this volatility. Let me tell you, it's not going to be a smooth ride. In the last 6 months, there has been too much going on worldwide.

2015-07-09 00:00:00 The Greek Crisis Takes a New Turn by Toby Nangle, Martin Harvey of Columbia Threadneedle

Talks between Greece and its creditors collapsed over the weekend. The Greek government has called a referendum on July 5 to accept or reject its creditors' terms — a move almost universally considered to be a poll on the continued membership of the euro area. The timing of this latest turn may have taken many by surprise, but like watching a slow-motion train wreck, few could say they didn’t see it coming.

2015-07-09 00:00:00 The Active - Passive Debate with Cathy Curtis by (Article)

Cathy Curtis, a California-based fee-only planner, discusses where the active-passive debate is heading and which asset classes are better suited for active management.

2015-07-08 00:00:00 APViewpoint Presents: Generating Tax Alpha with Effective Asset Location by Doug Short (Article)

A live, CFP/IMCA CE-eligible webinar presented by Michael Kitces on Wednesday, July 8, at 4:15 pm ET. While asset allocation and diversification are standard practices among advisors, the question of how to identify and optimize asset class locations to address each client’s time horizons, and the expected return and tax efficiency of the underlying investments, is far more challenging.

2015-07-08 00:00:00 Multiple Jobholders: Two Decades of Trends by Jill Mislinski (Article)

What are the long-term trends for multiple jobholders in the US? The Bureau of Labor Statistics has two decades of historical data to enlighten us on that topic, courtesy of Table A-16 in the monthly Current Population Survey.

At present, multiple jobholders account for about five percent of civilian employment. The survey captures data for four subcategories of the multi-job workforce, the current relative sizes of which I've illustrated in a pie chart.

2015-07-08 00:00:00 With High-Yield ETFs, Costs Can Be Hidden by Gershon Distenfeld of AllianceBernstein

More and more investors see exchange-traded funds (ETFs) as an easy and inexpensive way to tap into the high-yield market. We have some friendly advice for them: look again.

2015-07-08 00:00:00 More of the Same by Scott Brown of Raymond James

The U.S. economic data reports have remained mixed, consistent with a moderately strong pace of growth in the near term. The June jobs data suggest that a September Fed rate hike may be a closer call than thought earlier. Meanwhile, Greece’s economy is in tatters. The country has to face the burden of further austerity or the chaos of a euro exit.

2015-07-08 00:00:00 The Fed After the "No" by John Canally of LPL Financial

The “no” vote in the Greek referendum on July 5, 2015, will potentially raise the level of economic and financial market volatility in the coming weeks as global investors assess the market and economic risks associated with an increasingly likely Greek exit (Grexit) from the Eurozone and from the Eurozone’s common currency, the euro.

2015-07-08 00:00:00 Trends in the Teenage Workforce by Doug Short (Article)

Last week CNN Money featured an article with the optimistic and intriguing title "More American teens are getting jobs. That's good for everyone." After reading the article, we decided to revise one of our monthly charts on Labor Force Participation to include the age 16-19 cohort -- one we've lumped in the past with the 20-24 year-olds. The first chart below features the three-month moving averages of the non-seasonally adjusted participation rates to better highlight the trends.

2015-07-08 00:00:00 Shareholder Activism Continues to Attract Assets and Boost Activity by Francis Gallagher, Peter Drippé of Visium Funds

While shareholder activism has been maligned in the past by the corporate world as a way to reap short-term gains at the expense of long-term shareholders, the practice is now enjoying an increasingly positive reputation. This change in perception is based on the beneficial long-term results of activist campaigns and the current view of activists as champions of shareholder value. Accordingly, the recent performance of activist-related investments, as well as their role in providing low-correlated returns has drawn significant interest from the institutional investment world.

2015-07-08 00:00:00 The Futility of Retirement Calculators by Roger Nusbaum of AdvisorShares

USA Today syndicated a post from Motley Fool that did a good job taking down the concept of retirement calculators. The two big points made were that these calculators make an assumption based on people needing a percentage of their pre-retirement income, which does not take into account the particulars of individual circumstances, and that the calculators often overlook other sources of income including, in some cases Social Security.

2015-07-08 00:00:00 Ratio of Part-Time Employed Remains Higher Than the Pre-Recession Levels by Jill Mislinski (Article)

Let's take a close look at Thursday's employment report numbers on Full and Part-Time Employment. Buried near the bottom of Table A-9 of the government's Employment Situation Summary are the numbers for Full- and Part-Time Workers, with 35-or-more hours as the arbitrary divide between the two categories. The source is the monthly Current Population Survey (CPS) of households. The focus is on total hours worked regardless of whether the hours are from a single or multiple jobs.

2015-07-07 00:00:00 Job Openings & Labor Turnover: Clues to the Business Cycle by Jill Mislinski (Article)

The latest JOLTS report (Job Openings and Labor Turnover Summary), data through May, is now available. The first chart below shows four of the headline components of the overall series, which the BLS began tracking in December 2000. The timeframe is quite limited compared to the main BLS data series in the monthly employment report, many of which go back to 1948, and the enormously popular Nonfarm Employment (PAYEMS) series goes back to 1939. Nevertheless, there are some clear JOLTS correlations with the most recent business cycle trends.

2015-07-07 00:00:00 Five Decades of Middle Class Wages: June 2015 Update by Jill Mislinski (Article)

We've updated this series to include the most recent release of the employment data and extrapolated CPI. The latest hypothetical annual earnings are at $35,363, down 14.9% from 42 years ago.

2015-07-07 00:00:00 Numbers Needed for the Prime U.S. Workforce to Recover by Doug Short (Article)

At last year's Jackson Hole Symposium, Fed Chair Janet Yellen delivered an extended analysis of "Labor Market Dynamics and Monetary Policy". Her speech essentially reviewed the ongoing debate over the mix of cyclical versus structural factors in employment since the Great Recession.

Here is an updated series of charts illustrating some structural changes in the workforce that are far more significant than the cyclical impact of the Great Recession.

2015-07-07 00:00:00 Climate Change Lessons for Your Portfolio by Michael Edesess (Article)

Here’s an argument that sheds light not only on the climate change problem, but also on the problem of investing a portfolio. The analogy is not a stretch. It may even tell us as much about the solution to a long-standing investment conundrum as it does about the response to climate change.

2015-07-07 00:00:00 Funds Gone Mild The Role of Cash in Value Managers’ Performance by John Coumarianos (Article)

While many well-known value funds have been poor performers lately, their long-term records remain excellent. Their cash positions have, in part, caused their recent underperformance, but cash has also fueled their longer-term outperformance.

2015-07-07 00:00:00 A First-Half Letter to Clients: Robert Shiller on the Valuation Quandary by Dan Richards (Article)

Since 2008, I have posted a template for a client letter each quarter as a starting point for advisors who want to send clients an overview of the period that just ended and some thoughts looking forward. This quarter’s letter addresses one of today’s most taxing questions for advisors and investors alike: How to deal with the quandary presented by today’s valuation levels on U.S. stocks.

2015-07-07 00:00:00 Why Neuroscience Trumps Investing Expertise in Gathering AUM by Daniel Solin (Article)

To convert more prospects into clients and grow your assets under management, a basic understanding of neuroscience is critical.

2015-07-07 00:00:00 Are We in a Bull Market? Danger, Will Robinson, Danger!1 by Baijnath Ramraika, Prashant Trivedi (Article)

Investors and speculators have taken up a near-religious conviction in the demi-god status of central bankers. Will these central bankers continue to enjoy their god-like status indefinitely or will they disappoint their followers?

2015-07-07 00:00:00 The Client-Savvy Colors That Make Presentations More Effective by Joyce Walsh (Article)

Your client reports and marketing presentations are arguably the most public face of your practice. How they look and the colors you choose affect the way clients and prospects respond to the information you want to convey.

2015-07-07 00:00:00 Making Investment Strategies Interesting by Beverly Flaxington (Article)

We are reworking fact sheets for a number of our specialty investment products. As we read them, we see that we use the same terminology and ideas over and over again. How can we make this aspect of our offering more compelling?

2015-07-07 00:00:00 Asia Better Positioned to Handle a Hike by Sponsored Content from Invesco (Article)

It’s no surprise investors are concerned about whether a Fed rate hike will cause a replay of 2013’s taper tantrum meltdown in Asia. In our view, Asian markets are better positioned today to withstand short-term deterioration in global sentiment when the Fed decides to hike rates.

2015-07-07 00:00:00 Trade Balance Up 1.2B from Revised April Headline by Jill Mislinski (Article)

Here we introduce the monthly report, International Trade in Goods and Services, also known as the FT-900. Data is published monthly by the Bureau of Economic Analysis with revisions that go back several months, with data going back to 1992. This report details U.S. exports and imports of goods and services.

2015-07-07 00:00:00 Update on Greece by Henderson Global Investors of Henderson Global Investors

What happens next in Greece? The immediate impact of the referendum will be to greatly intensify financial and economic pressures in Greece. Now without a bailout, Greece will struggle to find the cash to pay for pensions and public sector wages. The government’s only option may be to make these payments in some form of IOUs in the weeks ahead.

2015-07-07 00:00:00 Jobs Take Backseat to Greece’s Austerity Vote by Kristina Hooper of Allianz Global Investors

Kristina Hooper, US Investment Strategist for Allianz Global Investors, dissects the June employment report and the investment implications of a deepening debt crisis in Greece, which is likely to spur higher volatility and renewed contagion fears.

2015-07-07 00:00:00 Predicting The Future Is Difficult by Lance Roberts of Streettalk Live

Predictions of the future are indeed very difficult, and yet individuals are challenged every day with doing precisely that. For traders, it is what the market, or a particular investment, will do in the next few minutes to days. For longer-term investors, those predictions move out to months or years.

2015-07-07 00:00:00 The Summer Solstice and Mid-Year Thoughts by Jeffrey Saut of Raymond James

Reflecting on the first half of 2015, while littered with geopolitical events, shows very little upside progress for the S&P 500 (SPX/2076.78). In fact, my notes of more than 50 years show no other time when the SPX was never up or down more than 3.5% year-to-date (YTD).

2015-07-07 00:00:00 Does Greece Pose a Threat to Global Markets? by Russ Koesterich of BlackRock

Russ explains why the situation in Greece likely doesn’t pose a longer-term threat to the global economy or financial markets.

2015-07-07 00:00:00 Big Door Opens to Smaller Chinese Companies by Liliana Castillo Dearth of AllianceBernstein

Structural changes in Chinese stock markets are opening up an entire world of smaller-cap stocks to foreign investors. But with valuations high and profitability low, make sure you know what you’re buying before diving in.

2015-07-07 00:00:00 On My Radar: Walking Into A Trap by Steve Blumenthal of CMG Capital Management Group

“If more respected investors had warned about the market in ’07, we might have avoided the crisis in ’08. I think the public is walking into a trap again…” -Carl Icahn via Twitter June 24, 2015

2015-07-07 00:00:00 Earning an Illiquidity Premium in Private Credit by Joshua Anderson, Tom Collier of PIMCO

With low yields and tight spreads prevalent in traditional liquid fixed income markets, many institutional investors are considering whether higher returns are available by assuming credit risk in private or illiquid form. We believe this type of alternative credit strategy may enhance portfolio returns, but investors should be extremely judicious when giving up liquidity, particularly today.

2015-07-07 00:00:00 Economic Outlook by (Article)

Carl Tannenbaum of Northern Trust shares an optimistic view of the US economy, jobs, and financial markets that may bode well for investors.

2015-07-07 00:00:00 Staring into an Abyss by Scott Minerd of Guggenheim Partners

With a resounding "NO" vote on the Greek referendum to accept the terms of Europe's proposed "bailout", market pundits are out in force talking about the coming turmoil. I think investors and policymakers alike would be wise to step back and put this unexpected outcome into perspective for the long term.

2015-07-07 00:00:00 Recession Probability Models - July 2015 by Ted Kavadas of StratX, LLC

There are a variety of economic models that are supposed to predict the probabilities of recession.

2015-07-07 00:00:00 Where’s Warren? by William Smead of Smead Capital Management

The conspicuously dressed children’s book character, Waldo, who dons a striped shirt and hat, is hard to miss, unless he’s in strange places or bizarre geographic settings. Similarly, Warren Buffett is often hard to miss. Yet every now and then, some bizarre market event happens, and we must ask, where’s Warren?

2015-07-07 00:00:00 Weighing the Week Ahead: Will FedSpeak Interrupt the Lazy, Hazy, Crazy Days of Summer? by Jeff Miller of NewArc Investments, Inc.

In one sense, the week ahead should be a quiet, dull semi-vacation. As Nat King Cole explained, the Lazy-Hazy-Crazy days of summer – pretzels, beer, and bikinis that never got wet. It is the lull before earnings and includes a light economic calendar. Will the A-Team need to return from the beach because of Greece? Or will it be a quiet week, disturbed only by an avalanche of FedSpeak and consequent punditry? One way or another, I think we will (finally) put the Greek drama behind us and resume the familiar debate about the Fed.

2015-07-07 00:00:00 Emerging-Market Stocks: Back on the Map by Milton Ezrati of Lord Abbett

After the volatility of the past few years, conditions once again appear favorable for this asset class.

2015-07-07 00:00:00 A Greek Play by Dr. Richard Michaud of New Frontier Advisors

The second quarter of 2015 experienced heightened bond market volatility in anticipation of the Fed’s first rate increase as well as international equity volatility involving Greek debt and Chinese equities. Despite whipsawed volatility, the major domestic and international equity indices ended close to where they started.

2015-07-07 00:00:00 Are You Really Keeping Your Eye on the Ball? by Jerry Wagner of Flexible Plan Investments

I was playing catch with my great-nephew, Bryson, over the weekend. He is just two years old and is a charmer. As we tossed the ball back and forth, he caught it and threw it back on target more times than he missed.

2015-07-07 00:00:00 China’s Stock Markets Imploded In June - Why? by Gary Halbert of Halbert Wealth Management

While the mainstream media has been obsessed with Greece over the last month or so, there has been scant attention paid to the fact that China’s high-flying stock markets unexpectedly have plummeted in June and were down around 30% through the end of last week.

2015-07-07 00:00:00 Historical Stock Market Analysis by Eric Bush of GaveKal Capital

According to our work, the US stock market is currently in the longest running cyclical bull market that has ever taken place in a structural bear market. We are currently in the 6th year of the cyclical bull market. No other cyclical bull in a structural bear has ever made it past five years (the prior longest was from October 2002 – October 2007).

2015-07-06 00:00:00 The Labor Market Conditions Index for June Shows Weak Expansion by Jill Mislinski (Article)

The Labor Market Conditions Index (LMCI) is a relatively recent indicator developed by Federal Reserve economists to assess changes in the labor market conditions. It is a dynamic factor model of labor market indicators, essentially a diffusion index subject to extensive revisions based on nineteen underlying indicators in nine broad categories (see the table at the bottom for details). Today's release of the June data indicates weak expansion at 0.8. Extensive historical revisions were made, with the May value revised from 1.3 to 0.9.

2015-07-06 00:00:00 Judging the Future at a Speculative Peak by John Hussman of Hussman Funds

With valuations still extreme and deterioration in market action continuing to indicate a shift toward risk-aversion among investors, we are less concerned about specific factors such as Greece than about much more general pressures that threaten to force an upward spike in compressed risk-premiums. We’ve often noted that a market collapse is nothing other than that phenomenon: razor-thin risk premiums that are then pressed abruptly to higher levels.

2015-07-06 00:00:00 Why Chinese Stocks are in a Bear Market and it Doesn’t Matter by Bryce Coward of GaveKal Capital

Chinese stocks are down a cool 30% from their high less than one month ago, but it matters little to most investors.

2015-07-06 00:00:00 Exporting the “Bacon Genie” and Other Reasons to Be Bullish by Brooks Ritchey of Franklin Templeton Investments

From “Bacon Genies” to “Snuggies,” there’s little doubting Americans have a thirst for consumer goods, even those that don’t always appear to serve much practical purpose. Brooks Ritchey, Senior Managing Director at K2 Advisors®, Franklin Templeton Solutions®, explores how an evolving consumer culture is spreading throughout the globe, and how he and his team are positioning their portfolios with these types of macro considerations in mind.

2015-07-06 00:00:00 Greece: Thinking the Unthinkable by Darren Williams of AllianceBernstein

Yesterday’s referendum has pushed Greece closer to euro-area exit, which would plunge the region into uncharted waters. But policymakers have powerful tools to combat contagion and prevent a Greek accident from triggering a wider recession.

2015-07-06 00:00:00 The Best Way to Judge Past Performance: Part Two by Chuck Carnevale of F.A.S.T. Graphs

On virtually every financial website on the planet there is a never-ending daily stream of stock tips and recommendations. Consequently, the investing public is literally flooded with information and advice regarding what stock to buy today or not to buy. Some of what is offered is supported by factual information and logic, but unfortunately, much of what is offered is merely based on the opinion of the author. This presents quite a challenge to the prudent prospective investor seeking sound advice or guidance.

2015-07-06 00:00:00 US Equity and Economic Review For the Week of June 29-July3; Some Weakness Technical Emerging by Hale Stewart of Hale Stewart

The biggest news last week was the employment report, which contained a headline number (223,000) a bit weaker than we’ve gotten used to. But, there is a very reasonable explanation.

2015-07-06 00:00:00 The Big Picture by Peter Schiff of Euro Pacific Capital

The past four years or so have been extremely frustrating for investors like me who have structured their portfolios around the belief that the current experiments in central bank stimulus, the anti-business drift in Washington, and America's mediocre economy and unresolved debt issues would push down the value of the dollar, push up commodity prices, and favor assets in economies with relatively low debt levels and higher GDP growth. But since the beginning of 2011, the Dow Jones Industrial Average has rallied 67% while the rest of the world has been largely stuck in the mud.

2015-07-06 00:00:00 Strategic Income: Positioning & Opportunities by (Article)

John Pattullo, Co-Head of Retail Fixed Income, discusses the Strategic Income Fund’s positioning and the current market environment. He notes the macro environment remains benign with some volatility spikes which can provide opportunities. John adds the deflation scare is broadly out of the way and Europe now in a better place with some growth coming through, which is encouraging.

2015-07-06 00:00:00 U.S. Stock Market: Should You Be Worried? by Brad McMillan of Commonwealth Financial Network

Yesterday wasn’t a good day for the stock market—anywhere. When I wrote yesterday’s post, the U.S. markets were only off by a bit. But the drop later in the day looked like it might be a bad sign; at a little over 2 percent, it was the largest one-day dip in some time.

2015-07-06 00:00:00 What does the Outcome of the Greek Referendum Mean? by John Greenwood of Invesco Blog

On Sunday, July 5, the Greek people had to choose in a referendum between Scylla and Charybdis: voting “Yes” if they were willing to accept the demands of their creditors and “No” if they rejected those proposals. The outcome was that approximately 61% voted “No” and 39% voted “Yes” in a turnout of 62% (6.16 million people out of 9.86 million registered voters).

2015-07-06 00:00:00 ISM Non-Manufacturing: Continued Growth in June at a Slightly Faster Rate by Jill Mislinski (Article)

Today the Institute for Supply Management published its latest Non-Manufacturing Report. The headline NMI Composite Index is at 56 percent, up 0.3% percent from last month's 55.7%. Today's number came in fractionally below the Investing.com forecast of 56.2 percent.

2015-07-06 00:00:00 Demographic Trends for the 50-and-Older Work Force by Doug Short (Article)

Note: This commentary has been updated with the latest numbers from last week's Employment Report.

This is not the scenario that would have been envisioned a generation ago for the "Golden Years" of retirement. Consider: Today nearly one in three of the 65-69 cohort and almost one in five of the 70-74 cohort are in the labor force.

2015-07-06 00:00:00 Another Look at Long-Term Trends in Employment by Age Group by Doug Short (Article)

The Labor Force Participation Rate (LFPR) is a simple computation: You take the Civilian Labor Force (people age 16 and over employed or seeking employment) and divide it by the Civilian Noninstitutional Population (those 16 and over not in the military and or committed to an institution). The result is the participation rate expressed as a percent.

2015-07-04 00:00:00 A Week of Unseen Things by John Mauldin of Mauldin Economics

We Americans are celebrating our Independence Day this weekend. The news our ancestors read on this day in 1776 wasn’t so great – but the US survived its rough start. China, Puerto Rico, and Greece will survive, too. But the decisions their government make, just like the ones our fledgling government made all those years ago, will make a great deal of difference. Let’s get past the gloom and doom to see if we can find some good news.

2015-07-03 00:00:00 Treasury Yields in Perspective by Doug Short (Article)

Let's have a look at a long-term perspective on Treasury yields. The chart here shows the 10-Year Constant Maturity yield since 1962 along with the Federal Funds Rate (FFR) and inflation. The range has been astonishing. The stagflation that set in after the 1973 Oil Embargo was finally ended after Paul Volcker raised the FFR to 20.06%.

2015-07-03 00:00:00 International Economic Week in Review For June 29-July 30; Greece and Canada Creating Problems, Edit by Hale Stewart of Hale Stewart

Greece is obviously the big wild card going into next week. And while the damage appears to be contained for now, there is no guarantee we won't see a negative feedback loop filter out into the market and EU economy. Canada's four months of GDP contraction are also getting a bit concerning. Even though we knew this was coming, it's still a most unwelcome development. However, other economies are at least holding their own for now.

2015-07-02 00:00:00 The Big Four Economic Indicators: Nonfarm Employment by Doug Short (Article)

Nonfarm Employment has been in a steady upward trend. Today's report of 223K new nonfarm jobs in June was a bit below expectations. More significant is the fact that May nonfarm payrolls were revised downward by 26K from 280K to 254K and April downward by 34K from 221K to 187K, a total revision of -60K for the two months. The unemployment rate ticked down two notches from 5.5% to 5.3%, a drop driven by a larger decline in the labor force (432K) than the reduction in the unemployed (375K).

2015-07-02 00:00:00 Investor Outlook: Trends are Looking Neutral by Andrew Pease of Russell Investments

Russell Investments’ Andrew Pease highlights insights from the investment strategists’ latest investor outlook and explains what may be in store for investors next quarter.

2015-07-02 00:00:00 All That Crap About Not Panicking? by Roger Nusbaum of AdvisorShares

It is still true. As I write this post Monday after the close there is still a lot of uncertainty on how Greece will precisely play out. Markets were down on Monday of course, right now the S&P 500 is at 2057 right around where it started the year and is flirting with its 200 day moving average.

2015-07-02 00:00:00 Investors Take Shelter as Greek Referendum Nears by Frank Holmes of U.S. Global Investors

American industrialist J. Paul Getty once said: “If you owe the bank $100, that’s your problem. If you owe the bank $100 million, that’s the bank’s problem.” And when the amount is $1.73 billion, it’s everyone’s problem. Greece is officially in arrears for missing its scheduled payment Tuesday to the International Monetary Fund (IMF). Expecting this, American stocks had their largest one-day drop of 2015 on Monday. Market volatility, as measured by the VIX, spiked sharply.

2015-07-02 00:00:00 US Participation Rate Drops To October 1977 Levels by Eric Bush of GaveKal Capital

At first glance, the most eye-opening stat in the latest monthly employment report is the fall in the participation rate from 62.9% to 62.6%. This latest level is the lowest level since October 1977.

2015-07-02 00:00:00 Eurozone Contagion Fears Flare as Greek Crisis Enters Crucial Phase by David Zahn of Franklin Templeton Investments

Whatever the outcome of the Greek referendum on Sunday (July 5), the result is likely to mean more uncertainty and possibly pain for the people of Greece. So far, according to David Zahn, head of European Fixed Income, Franklin Templeton Fixed Income Group, the economic fallout of the crisis appears to be mostly contained within Greece, and the likelihood of longer-term contagion to other eurozone economies seems to be limited.

2015-07-02 00:00:00 Looking for Income in All the Right Places by Morgan Harting, Martin Atkin of AllianceBernstein

Investors and advisors know they can’t depend solely on the old standbys—bonds, high-dividend stocks and cash—to produce income today, and they’re ready to try a new approach. But which one?

2015-07-02 00:00:00 Greek Default is Everyone’s Fault by Carl Tannenbaum of Northern Trust

We do not expect widespread global contagion, but reducing the risk of this outcome will require renewed cooperation between Greece and its creditors. They created the problem together, and neither side can claim the high ground. It is about time that they came back down to earth and worked this thing out.

2015-07-02 00:00:00 The Business Cycle—Middle-Aged or Elderly? by Erik Knutzen of Neuberger Berman

When it comes to the duration of the business cycle, 50 is the new 40. Much the way that better diet, health care and exercise have helped double life expectancy over the past century, central banks have prolonged the current expansion using new elixirs such as zero interest rates and quantitative easing. At 72 months, the business cycle has well surpassed the 58.4-month average of the modern era and is now more than twice the length of the pre-WWII average.

2015-07-02 00:00:00 California’s Drought Won’t Affect Its Municipal Debt by Daryl Clements, John Ceffalio of Alliance Bernstein

California has endured four years of severe drought, raising fears of economic hardship and reduced revenues at water authorities. We don’t think the state will run out of water—or money to pay its debts.

2015-07-02 00:00:00 Home of the Free, Land of the Entrepreneur by Frank Holmes of U.S. Global Investors

Where else but in America can a startup such as Uber be valued at $50 billion, higher than 80 percent of the companies in the S&P 500 Index, only six years after its founding? Where else but in America can someone reach billionaire status by inventing a new type of hosiery, as Sara Blakely did with Spanx? Before her now-ubiquitous undergarments were worn by women—and now men—all over the globe, Blakely was so broke that she had to write her own patent without the help of an attorney.

2015-07-02 00:00:00 Why the Greek Bailout Failed by Kenneth Rogoff of Project Syndicate

As the crisis in Greek demonstrates, imposing structural reforms from outside a country is unlikely to succeed without the willingness of a capable government. If a bailout program requires a wholesale change in a country’s economic model, moving swiftly to write down outstanding debts may be the more sensible option.

2015-07-02 00:00:00 Market Valuation, Inflation and Treasury Yields: More Clues from the Past by Doug Short (Article)

Our monthly market valuation updates have long had the same conclusion: US stock indexes are significantly overvalued, which suggests cautious expectations on investment returns. In a "normal" market environment -- one with conventional business cycles, Federal Reserve policy, interest rates and inflation -- current valuation levels would be a serious concern.

But these are different times.

2015-07-02 00:00:00 June New Jobs Came In Below Forecast and May Was Revised Down by 26K by Doug Short (Article)

Today's report of 223K new nonfarm jobs in June was a bit below the Investing.com forecast of 230K. More significant is the fact that May nonfarm payrolls were revised downward by 26K from 280K to 254K and April downward by 34K from 221K to 187K, a total revision of -60K for the two months. The unemployment rate ticked down two notches from 5.5% to 5.3%, a drop driven by a larger decline in the labor force (432K) than the reduction in the unemployed (375K).

2015-07-02 00:00:00 The Market Remains in Overvaluation Territory by Doug Short (Article)

Here is a summary of the four market valuation indicators we update on a monthly basis.

  • The Crestmont Research P/E Ratio
  • The cyclical P/E ratio using the trailing 10-year earnings as the divisor
  • The Q Ratio, which is the total price of the market divided by its replacement cost
  • The relationship of the S&P Composite price to a regression trendline

2015-07-02 00:00:00 The Civilian Labor Force, Unemployment Claims and the Business Cycle by Doug Short (Article)

What does the ratio of unemployment claims tell us about where we are in the business cycle and our current recession risk? At present, the ratio for Continued Claims has been trending down. Excluding the 1981 recession, the Initial Claims trough lead time for a recession has ranged from 7 to 22 months with an average of 12 months if we include the 1981 recession and 14 months if we exclude it. Admittedly, the last recession is an extreme example, but the Initial Claims trough preceded its December 2007 onset by a whopping 22 months.

2015-07-01 00:00:00 Anticipating the Employment Report for June by Doug Short (Article)

The economic mover and shaker this week is tomorrow's employment report from the Bureau of Labor Statistics. This monthly report contains a wealth of data for economists, the most publicized being the month-over-month change in Total Nonfarm Employment.

Today we have the June estimate of 237K new nonfarm private employment jobs from ADP, up from the May's 203K, which is an upward revision from 200K. Also the April number was revised upward by 14K.

2015-07-01 00:00:00 Light Vehicle Sales Per Capita: Another Look at the Long-Term Trend by Doug Short (Article)

For the past few years we've been following a couple of transportation metrics: Vehicle Miles Traveled and Gasoline Volume Sales. For both series we focus on the population adjusted data. Let's now do something similar with the Light Vehicle Sales report from the Bureau of Economic Analysis. This data series stretches back to January 1976. Since that first data point, the Civilian Noninstitutional Population Age 16 and Over (i.e., driving age not in the military or an inmate) has risen 61.9%.

2015-07-01 00:00:00 Is the Stock Market Cheap? by Doug Short (Article)

Here is a new update of a popular market valuation method using the most recent Standard & Poor's "as reported" earnings and earnings estimates and the index monthly average of daily closes for the past month. For the earnings, see the table below created from Standard & Poor's latest earnings spreadsheet.

2015-07-01 00:00:00 Regression to Trend: A Perspective on Long-Term Market Performance by Doug Short (Article)

Quick take: At the end of June the inflation-adjusted S&P 500 index price was 91% above its long-term trend, a slight decline from the previous month.

About the only certainty in the stock market is that, over the long haul, over performance turns into under performance and vice versa. Is there a pattern to this movement? Let's apply some simple regression analysis to the question.

2015-07-01 00:00:00 Secular Bull and Bear Markets by Doug Short (Article)

Was the March 2009 low the end of a secular bear market and the beginning of a secular bull? At this point, six years later, the S&P 500 has set an inflation-adjusted record high.

Let's examine the past to broaden our understanding of the range of historical trends in market performance. An obvious feature of this inflation-adjusted series is the pattern of long-term alternations between up-and down-trends.

2015-07-01 00:00:00 The 1982 Playbook by William Smead of Smead Capital Management

When the stock market exploded to the upside after March 10th of 2009, I turned to my colleagues and said, "It's time to get out the 1982 playbook." The last deep recession with well-above 10% unemployment was in 1982 and stocks had suffered from numerous bear markets. Stocks took off in anticipation of an enduring economic recovery and it paid to believe in its longevity and the positive long-duration effect it would have on stock prices.

2015-07-01 00:00:00 The Smartest Man is Wild about Innovation by Byron Wien of Blackstone

For the past fifteen years I have written annually about a person I have come to call “The Smartest Man in Europe.” For new readers, he is a finance person in his 80’s who has built his reputation by identifying important trend changes early and putting serious money behind his conclusions. Descended from a mercantile family that operated canteens selling food and weather protection along the Silk Route, he was educated in Europe, trained in New York and returned home to take advantage of the wealth-creating opportunities resulting from the post-war recovery.

2015-07-01 00:00:00 The 2015 Mid-Year Geopolitical Outlook by Bill O’Grady of Confluence Investment Management

As is our custom, at mid-year, we update our geopolitical outlook for the rest of the year. This report is less a series of predictions as it is a list of potential geopolitical issues that we believe will dominate the international situation into year’s end. It is not designed to be exhaustive; instead, it focuses on the “big picture” conditions that we believe will affect policy and markets going forward. They are listed in order of importance.

2015-07-01 00:00:00 Greece Firestorm Won't Stifle Consumer Comeback by Kristina Hooper of Allianz Global Investors

Investors should expect more volatility in the stock market and larger flows into US Treasuries this week given the increased likelihood of a Grexit. Rather than hide, investors could view this crisis as a buying opportunity—a chance to position their portfolios for the second half of 2015. Over the longer term, fundamentals like job creation and a healthier consumer play a far more important role.

2015-07-01 00:00:00 Investing in Lake Wobegon: Where all the returns are above average by David Robertson of Arete Asset Management

The implicit assumption of many funds is that returns will be attractive over the investor's time horizon. Increasingly, this assumption appears to be invalid and many long term investors would be better served by taking an "absolute return" approach to investing.

2015-07-01 00:00:00 Stuck in the Middle with You by Jerry Wagner of Flexible Plan Investments

I’ve always loved music and have tried to work it into my columns every once in a while. After writing an article centered on Passenger’s Let her go last week, I was not looking to do another one so soon. Still, when I saw the following chart on the State of the Markets blog this morning, the song title just popped into my head.

2015-07-01 00:00:00 The Whole Story: Factors + Asset Classes by Jason Hsu of Research Affiliates

Every year we invite some of the investment industry’s most creative thinkers to speak about their work at the Research Affiliates’ Advisory Panel conference. Along with Nobel laureates Vernon Smith and Harry Markowitz, the speakers at our 14th annual meeting included Campbell Harvey, Richard Roll, Andrew Karolyi, Bradford Cornell, Andrew Ang, Charles Gave, Tim Jenkinson, and our very own Rob Arnott. The richness of the speakers’ presentations beggars any attempt to summarize them; I’ll limit myself to the points I found most intriguing and illuminating.

2015-07-01 00:00:00 Greek Contagion Fears Likely Overblown by Gary Black of Calamos Investments

We remain bullish on global equities despite the expected near-term volatility, as we believe the Greek situation will be resolved in a manner that the markets will view constructively. Although the Greek debt drama has veered off script over the past few days, we believe investors have overdiscounted the impact of Greece defaulting on its IMF loan. We expect volatility will stay high in the run up to the Greek austerity referendum scheduled for July 5.

2015-07-01 00:00:00 The Greek Saga Escalates by Carl Tannenbaum, Victoria Marklew of Northern Trust

The situation in Greece has taken some unexpected turns over the past several days, commanding the lion’s share of the market’s attention ever since. Following are answers to the questions we are being asked most frequently about the situation.

2015-07-01 00:00:00 Epic Uncertainty: Markets React to Greek Debt Crisis by Laura Sarlo of Loomis Sayles

It's a tense standoff between Greece and its international creditors. Unless both sides dramatically return to the negotiating table, Greece looks set to default on its €1.5 billion International Monetary Fund (IMF) loan payment on June 30.

2015-07-01 00:00:00 Data Dependence Is Not a Monetary Policy, But Are the Dots? by Richard Clarida of PIMCO

At its June meeting, the Fed emphasized data dependence in setting monetary policy. Although a data-dependent Fed is one that appears to retain a great deal of optionality on the timing and pace of future rate moves, data dependence itself is not a monetary policy. The Fed’s reaction function to evolving data will likely determine the path of policy normalization. The “dot plot” provides some insight, but the dots alone don’t tell us how policy will play out if the macro data evolve differently from the baseline.

2015-07-01 00:00:00 A Return to Fundamentals? by Niels Jensen of Absolute Return Partners

June was a very eventful month, in particular here in Europe. Greece went from bad to worse, and the Greek people have now been asked to vote on their own destiny in a referendum scheduled for Sunday 5 July, which we expect to return in a 'Yes' vote. However, Greece is not the only subject in the July Absolute Return Letter. Financial markets have in many ways behaved oddly since the near meltdown in 2008. The objective of this month's letter is to look at whether we are finally beginning to see some sort of normalisation - as in a return to the conditions we had prior to 2008...

2015-07-01 00:00:00 More Volatility: A Positive Environment for Active Managers by Chuck Royce, Francis Gannon of The Royce Funds

Dating from the year-to-date low for the 10-Year Treasury on January 30 through the end of the first half, we have observed promising signs that the market may be taking greater strides toward normalization. CEO Chuck Royce and Co-CIO Francis Gannon discuss how higher rates might benefit bottom-up stock pickers, the potential for quality companies to regain leadership as volatility increases, the possible consequences of global economic recovery for both domestic and non-U.S. small-cap stocks, and the favorable landscape for consumers and its effect on our portfolio positioning.

2015-07-01 00:00:00 ProVise Bullets by Team of ProVise Management Group

Okay, so where did the last six months go? Hard to believe that half of 2015 is gone and even harder to believe that we have a presidential election coming up in “only” 16 months. Of course, with all the candidates coming out, especially on the Republican side, it is going to be an interesting 10-12 months while the primaries play out.

2015-07-01 00:00:00 Obamacare Upheld Again: Consequences for Business Owners and Investors by Andy Friedman of The Washington Update

Last week the Supreme Court ruled that all qualifying Americans are entitled to receive subsidies to purchase health insurance under the Affordable Care Act, regardless of where in the country they live.

2015-07-01 00:00:00 Growth Matters by Mark Mobius of Franklin Templeton Investments

We have found that companies in the consumer or retail space with a high market share can benefit from rising consumption and GDP per capita. These investments are particularly attractive if profit margins can be improved.

2015-07-01 00:00:00 Greece and Puerto Rico Spark Global Volatility by K. Sean Clark of Clark Capital Management Group

More than five years after first entering investors’ view, the Greek drama has again hit center stage and has investors fretting about a market collapse.

2015-07-01 00:00:00 Greece: Weighing the Risks by Milton Ezrati of Lord Abbett

It seems Greece has chosen default and capital controls. Even so, Athens can still cut a deal that would relieve both. Either way, it will remain unclear for a while whether the country stays in the common currency. In some respects, this situation is entirely manageable. That fact has fostered a dangerous complacency, for in other respects, this situation carries considerable risk—for the eurozone, for European finance in general, and for global finance.

2015-07-01 00:00:00 The Q Ratio and Market Valuation: June Update by Doug Short (Article)

The Q Ratio is a popular method of estimating the fair value of the stock market developed by Nobel Laureate James Tobin. It's a fairly simple concept, but laborious to calculate. The Q Ratio is the total price of the market divided by the replacement cost of all its companies.

2015-07-01 00:00:00 ISM Manufacturing Index: 30th Consecutive Month of Expansion by Doug Short (Article)

Today the Institute for Supply Management published its monthly Manufacturing Report for June. The latest headline PMI was 53.5 percent, an increase of 0.7% from the previous month and slightly above the Investing.com forecast of 53.1. This was the 30th consecutive month of expansion.

2015-07-01 00:00:00 Crestmont Market Valuation Update by Doug Short (Article)

Quick take: Based on the June S&P 500 average of daily closes, the Crestmont P/E is 97% above its arithmetic mean and at the 98th percentile of this fourteen-plus-decade monthly metric.

2015-06-30 00:00:00 Regional Fed Manufacturing Overview by Jill Mislinski (Article)

The Federal Reserve System consists of twelve Federal Reserve Banks, twenty five branches, and the Board of Governors in Washington, D.C. Each bank serves a larger regional district. Five out of the twelve Federal Reserve Regional Districts currently publish monthly data on regional manufacturing: Dallas, Kansas City, New York, Richmond, and Philadelphia. Here we introduce an overview of all five with an overlay and average of historical data.

2015-06-30 00:00:00 Can American Funds Sustain Its Outperformance? by Larry Swedroe (Article)

Among actively managed funds, American Funds has a reputation for providing investor-friendly, low-cost products with sustained records of outperformance. But has it outperformed comparable funds from Vanguard and Dimensional Fund Advisors (DFA)? If so, should investors expect its funds to maintain their edge?

2015-06-30 00:00:00 Evaluating Investments versus Insurance in Retirement by Wade Pfau (Article)

In the past, I’ve described two fundamentally different philosophies for retirement-income planning: probability-based and safety-first. Those philosophies diverge on the critical issue of where an individual must place their trust: in the risk/reward tradeoffs of an equity portfolio, or on the contractual guarantee of insurance products. Here’s how to overcome that challenge and integrate the two approaches in a retirement plan.

2015-06-30 00:00:00 Three Responses When a Prospect Already has an Advisor by Dan Richards (Article)

Advisors often run into prospects who already have an advisor in place. Here are three hot buttons to engage those who already have an advisor.

2015-06-30 00:00:00 The Epiphany that Changed Everything by Daniel Solin (Article)

Every time I coach a group of advisors, I invariably learn something new in the process. Here is how my time working with practitioners led to an epiphany that changed the focus of my coaching – and drove better results for my clients.

2015-06-30 00:00:00 Dealing with a Difficult Partner by Beverly Flaxington (Article)

Our advisory business is going very well. The better it goes, the less involved my business partner becomes. She will come in late, leave early and generally be disruptive when she is here. God forbid I say anything and she bursts into tears. What can I do?

2015-06-30 00:00:00 Stop Ignoring Millennials: They’re The Future of Your Company by Lauren Hong (Article)

Millennials are bucking trends day-in and day-out. As of 2013, they’re officially the largest, most diverse generation in the U.S. As a financial advisor, you cannot ignore them. Here’s how to include millennials in your marketing plan.

2015-06-30 00:00:00 A Case Study for Using Life Settlements by Stephen Terrell (Article)

I recently sat down with one financial advisor who truly believes that life settlements serve a great purpose for the right client in the right situation. And his case study is emblematic of how these transactions, which enable a senior to sell a life insurance policy for immediate cash, can be an appropriate option for the right client.

2015-06-30 00:00:00 S&P 500 Suffers First 2% Down Day Since End of 2014 by Bryce Coward of GaveKal Capital

Today was no doubt a risk off day for the markets. There was persistent selling pressure in stocks worldwide with the S&P 500 down 2.09%, but international indexes down quite a bit more. Given that today was the first 2% down day since December 18th, 2014 and October 10th, 2014 before that, we thought we’d highlight the utter lack of volatility in these markets since the end of 2011.

2015-06-30 00:00:00 In the Know: Fed Policy and Fixed Income by Roger Bayston of Franklin Templeton Investments

As fixed income investors, we have to build more tools and use different types of tools when managing our portfolios, allowing ourselves to remain more liquid in some of our short-term investments in order to keep what we believe to be a prudent level of risk given the changes in liquidity in the marketplace.

2015-06-30 00:00:00 Greek Moves Test ECB Resolve on Europe by Darren Williams of AllianceBernstein

Greece’s five-year debt crisis is escalating fast. A default on the IMF now looks almost certain and the country is taking a big step toward a possible exit from the euro area. What really matters now, though, is the impact on other countries—and how the ECB will respond.

2015-06-30 00:00:00 Greece Isn’t the Only Problem U.S. Stocks Face by Russ Koesterich of BlackRock

Several factors are dampening investor sentiment, including Greece and an emerging bear market in China. However, for U.S. markets, a longer-term problem may be one closer to home. Russ explains.

2015-06-30 00:00:00 An Important Week for Economic Data by Scott Brown of Raymond James

Fed officials have signaled that monetary policy decisions will be data-dependent. Hence, financial market participants will closely examine upcoming economic reports. Data are expected to remain consistent with an improving economy and an initial increase in short-term interest rates by the end of the year.

2015-06-30 00:00:00 Independence Day?: “Greferendum” on July 5 Rocks Markets by Liz Ann Sonders of Charles Schwab

“Greferendum”… the new “it” word of the day. In the United States, we celebrate Independence Day on July 4; but investors today are more interested in whether the following day will mark an independence day for Greece. As last week came to a close, Greek Prime Minister Alexis Tsipras walked away from talks with his country’s creditors and announced a referendum scheduled for July 5.

2015-06-30 00:00:00 It Never Rains in California by Bill Gross of Janus Capital Group

Ted Cruz recently suggested praying for rain in Texas, and apparently someone did a few weeks ago, producing a deluge resembling a modern day Noah’s Ark of sorts. California’s Governor Brown on the other hand, has taken a more secular approach. He believes that Mammon, not God, bears responsibility for the Golden State’s record drought and that I, we, all of us simple folk should cut back water usage by a minimum of 25%.

2015-06-30 00:00:00 The Joy Of Portfolio Boredom by Roger Nusbaum of AdvisorShares

Last week I stumbled across an article that favorably critiqued an alternative-strategy ETF for being boring which is its objective. “Boring” is not the stated objective in the prospectus but terms like market neutral, absolute return, low correlation to equities and some others really are about boredom. You can judge for yourself whether a given fund that is supposed to be boring is indeed boring as not every fund will deliver on its stated objective.

2015-06-30 00:00:00 A Mid-Year Assessment of Our Ten Predictions by Robert Doll of Nuveen Asset Management

We have described 2015 as the year when investors transition from disbelief to belief, or from skepticism to optimism. Sir John Templeton coined the phrase, “Bull markets are born on pessimism, grow on skepticism, mature on optimism and die on euphoria.” We believe we are entering the “optimism” phase.

2015-06-30 00:00:00 Ignore Greece by Brian Wesbury, Robert Stein of First Trust Advisors

Don’t let anyone tell you Greece is sticking up for its "dignity" by fighting “austerity.” The current Greek government is sticking up for socialism by fighting reality.

2015-06-30 00:00:00 Flexible Indexing: A Nontraditional Approach by Shundrawn Thomas, Northern Trust Asset Management, Head of Funds and Managed Accounts (Article)

How FlexShares' Flexible Indexing approach produces nontraditional indexes that target fundamental investor goals.

2015-06-29 00:00:00 Floating-Rate Loan Investors: Clairvoyant or Missing Out? by Scott Page, Craig Russ, Christopher Remington of Eaton Vance

In a rising rate environment, we put floating-rate loans high on the list of fixed-income investment classes likely to perform well in 2015.

2015-06-29 00:00:00 Durable Returns, Transient Returns by John Hussman of Hussman Funds

Over the course of three speculative bubbles in the past 15 years, I’ve often made the distinction between “durable” investment returns and transient ones. At any point in time, the cumulative long-term return of the stock market equals the gain that investors can reasonably assume will be durable (in that it is unlikely to be surrendered in the future), plus whatever market gain investors should assume will be entirely wiped out over the course of the present or future market cycles. As it turns out, those two components can be identified with surprising accuracy.

2015-06-29 00:00:00 US Equity and Economic Review For the Week of June 22-26; Getting Ready For a Move Higher? Edition by Hale Stewart of Hale Stewart

First quarter economic data was largely bearish, as confirmed by last week’s third revision to GDP data. While the .2% decrease was better than the -.7% in the second revision, it was still negative.

2015-06-29 00:00:00 Don’t be Surprised - Speech to CFA Society of Chicago by Stephen Romick of FPA Funds

I’m reminded of a gentleman who discovers a genie in a bottle. Granted one wish only – apparently even genies have pricing power – the man asks for peace in the Middle East. The genie backs away and says, “That’s way too difficult. Give me something easier.” The man ponders his options and asks the genie instead, to help him pick a good mutual fund. The genie quickly responds, “Let me get to work on the Middle East.”

2015-06-29 00:00:00 Weighing the Week Ahead: Greek Ripples or Economic Fireworks? by Jeffrey Miller of NewArc Investments, Inc.

The elements are in place for a week of fireworks. Barring some unlikely last-minute news, we are expecting a Greek bank holiday and capital controls on Monday, followed by one of the biggest weeks of the year for economic data, all crammed into a holiday shortened week. Will it be…

2015-06-29 00:00:00 Emerging Markets After the Fed Hikes Rates by Nouriel Roubini of Project Syndicate

The prospect that the US Federal Reserve will start exiting zero policy rates later this year has fueled growing fear of volatility in emerging economies’ currency, bond, and stock markets. But, with a few exceptions lacking systemic importance, widespread distress and crises need not occur.

2015-06-29 00:00:00 Europe’s Attack on Greek Democracy by Joseph Stiglitz of Project Syndicate

The rising crescendo of bickering and acrimony within Europe might seem to outsiders to be the inevitable result of the bitter endgame playing out between Greece and its creditors. In fact, European leaders are finally beginning to reveal the true nature of the ongoing debt dispute, and the answer is not pleasant.

2015-06-29 00:00:00 On My Radar: Buffett Burgers and The Hallelujah Chorus by Steve Blumenthal of CMG Capital Management Group

"People are habitually guided by the rear-view mirror and, for the most part, by the vistas immediately behind them.”– Warren Buffett

2015-06-29 00:00:00 Newsletter - June 2015 by Harold Evensky of Evensky & Katz

Ever hear of Noah? I hadn’t until I read an article in Institutional Investors. It turns our Noah is a NYSE-listed wealth management firm – a Chinese wealth management firm. It employs 779 relationship managers in 94 offices in 64 cities throughout China! Not only that, it was founded and managed by Chairman and CEO Wang Jingbo, a young woman! I remember hearing a lot about a “New Era” in the ’90s. That story fizzled, but I believe this story is about a real New Era. It’s a risky time to be myopic with a home country bias in investing.

2015-06-29 00:00:00 "Debt Gone Wild" - Debt Funded Stock Buybacks Soar by Lance Roberts of Streettalk Live

I penned an article recently discussing the many measures that corporations have used in recent years to "beat" Wall Street estimates. Of course, the beating of Wall Street estimates, so adamantly adored by mainstream media, always ignores the fact that estimates are continually reduced so that companies to "beat" them. This is the equivalent of moving the "target to the arrow."

2015-06-29 00:00:00 Grantham: Stocks Will Continue Upward until the Election by Justin Kermond of Advisor Perspectives

Jeremy Grantham says equity valuations are heading toward the “two-sigma” level that is the requisite threshold for a true bubble. At some point – which is not imminent – he says a “trigger” will precipitate the reversion back to mean levels. The market will continue to deliver positive returns until the next election, according to Grantham.

2015-06-29 00:00:00 CEF Market Update by (Article)

Discounts widened in the CEF market in the first half of 2015, creating potential opportunities for investors, says Cara Esser of Morningstar.

2015-06-29 00:00:00 Trouble with Zero by (Article)

Carl Tannenbaum, the chief economist for Northern Trust, discusses the risks the Fed faces if it relaxes its zero-interest-rate policy, as well as the risks it will face if it delays a rate increase.

2015-06-29 00:00:00 Grantham: Stocks Will Continue Upward until the Election by Justin Kermond (Article)

Jeremy Grantham says equity valuations are heading toward the “two-sigma” level that is the requisite threshold for a true bubble. At some point – which is not imminent – he says a “trigger” will precipitate the reversion back to mean levels. The market will continue to deliver positive returns until the next election, according to Grantham.

2015-06-29 00:00:00 Sallie Krawcheck’s Solution to the Retirement Crisis by Justin Kermond (Article)

Sallie Krawcheck is a woman with a cause. She has a solution to the retirement crisis and a strategy for advisors to grow their female client bases.

2015-06-27 00:00:00 Shoot the Dog and Sell the Farm by John Mauldin of Mauldin Economics

The Greek situation is presently caught in those two bubbles on the bottom. European leaders held summit meetings this week to consider new breakthrough concessions offered by Greek Prime Minister Alexis Tsipras. Let the champagne flow. Except those concessions were rejected, and the Greeks rejected the counteroffer as of this afternoon. But it’s not quite midnight yet.

2015-06-27 00:00:00 $8 Trillion Alternative Energy Boom Is a Win for Copper by Frank Holmes of U.S. Global Investors

As the world’s population continues to grow, and as more people in developing and emerging countries gain access to electricity, the role alternative energy sources such as wind, solar and geothermal play should skyrocket. Between now and 2040, a massive $8 trillion will be spent globally on renewables, about two thirds of all energy spending, according to Bloomberg New Energy Finance. Solar power alone is expected to draw $3.7 trillion.

2015-06-27 00:00:00 ECRI Weekly Leading Index: Little to No Change by Doug Short of Advisor Perspectives (dshort.com)

ECRI's most recent article suggests that wage inflation does not support the case for a rate increase. "The recent rise in wage inflation, having become an obvious fact, is increasingly being used to support the case for rate hikes – including by Fed Chairman Janet Yellen, who now sees these “tentative signs of stronger wage growth” as a harbinger of inflation."

2015-06-27 00:00:00 The Most Likely Outcome for Greece by Russ Koesterich of BlackRock Investment Management

Russ provides his short- and long-term outlook for Greece, explaining why the country will likely continue to be a source of headline risk for the foreseeable future.

2015-06-27 00:00:00 High Drama for the Hellenic Republic by Carl Tannenbaum of Northern Trust

Hard realities and hardened positions are combining to create a dangerous game of financial chicken between Greece and its creditors. We can only hope they avoid a headlong collision that could create a lot of collateral damage.

2015-06-27 00:00:00 Is The Decline in the Euro Over? by Jennifer Thomson of GaveKal Capital

Though downward pressure on the EUR/USD exchange rate has eased a bit since April, we can’t yet say for certain that the trend has reversed. We will be watching these charts, in particular, for any clues as conditions in the Eurozone evolve over the coming weeks.

2015-06-27 00:00:00 Not Too Hot… by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

Despite the narrow range for US stocks this year, things can change quickly. We believe volatility will pick up over the next several months as we head toward the Fed’s initial rate hike. Across the pond, the best we may be able to hope for with regard to Greece is another “kick-the-can” solution. But any potential damage should be relatively contained due to the work done in the Eurozone over the past five years.

2015-06-26 00:00:00 Shelter from the Storm in Europe by Mohamed El-Erian of Project Syndicate

To secure a prosperous future, Europe must confront three distinct challenges: the Greek crisis, Russia’s incursion in Ukraine, and the rise of populist political parties. While Europe could address each of these challenges individually with relatively little risk, all three must be addressed simultaneously.

2015-06-26 00:00:00 Time to Consider Municipal High Yield? by David Jurca of Russell Investments

David Jurca explains why investors may want to consider municipal high yield to help manage taxes, especially since it can offer strong tax equivalent yields at a historically attractive level of volatility.

2015-06-26 00:00:00 International Economic Week In Review For the Week of June 22-26; More Good News, Edition by Hale Stewart of Hale Stewart

It appears more and more likely that Japan has shaken off the negative impact of the sales tax hike from a year ago. The EU appears to be growing. Australia, while still growing at a ~2% clip, is feeling the negative impact of the commodity bear market. The US has shaken off the weak 1Q number.

2015-06-26 00:00:00 India's Structural Challenges by Sudarshan Murthy of Matthews Asia

India is in need of sweeping reforms in order to realize the full power of its entrepreneurial talent and to ensure social improvements for its poor and middle class. Despite some encouraging efforts, the Modi government may need significant time to carry out such reforms, as its many public institutions are still a far cry from being considered inclusive—meaning they lack such attributes as well-defined property ownership rights, flexible labor policies and all-encompassing political representation.

2015-06-25 00:00:00 The PCE Price Index Remains Disappointingly Below Target by Doug Short (Article)

The Personal Income and Outlays report for May was published this morning by the Bureau of Economic Analysis. The latest Headline PCE price index year-over-year (YoY) rate is 0.22%, little changed from 0.16% the previous month. The latest Core PCE index (less Food and Energy) at 1.24% is a slight decline from the previous month's 1.29% YoY.

The adjacent thumbnail gives us a close-up of the trend in YoY Core PCE since January 2012.

2015-06-25 00:00:00 Two Measures of Inflation and Fed Policy by Doug Short (Article)

The BEA's Personal Consumption Expenditures Chain-type Price Index for May shows core inflation below the Federal Reserve's 2% long-term target at 1.24%. The latest Core Consumer Price Index release, also data through May, is higher at 1.72%. The Fed is on record as using Core PCE data for its primary inflation gauge.

2015-06-25 00:00:00 The Big Four Economic Indicators: Real Personal Income by Doug Short (Article)

Personal Income (excluding Transfer Receipts) in May rose 0.61% and is up 4.3% year-over-year. When we adjust for inflation using the BEA's PCE Price Index, Real Personal Income (excluding Transfer Receipts) rose 0.30%. The real number is up 4.07% year-over-year. Real PI less TR is one of those indicators that warrants adjustment for population growth.

2015-06-25 00:00:00 US GDP Growth Over Time by Eric Bush of GaveKal Capital

When the first estimate for US GDP was release, we showed how the long-term growth rate of the US economy has been steadily falling for decades. We highlighted this by looking at the 10-year annualized percentage change in nominal and real GDP.

2015-06-25 00:00:00 Unconstrained Global Investing in an Extraordinary Monetary Policy Enviornment by Michael Hasenstab of Franklin Templeton Investments

As we see it, it is only a matter of time before US wages start to rise to levels where inflation is triggered. Using the Fed’s own estimates, we are quite close to what’s considered to be full employment. To us, this does not justify 0% interest rates.

2015-06-25 00:00:00 Gaining Greater Lift in Your Glide Path by Daniel Loewy, Christopher Nikolich of AllianceBernstein

Target-date funds have always promoted the mantra of diversification (“don’t put all your eggs in one basket”). Now it’s time to preach—and practice—an even wider diversification strategy.

2015-06-25 00:00:00 Outrunning the Bear: Pension Strategy in a Low Return World by Jared Gross of PIMCO

Pension investors often seek to meet two conflicting objectives: delivering high absolute returns and managing risk relative to liabilities. Unfortunately, this approach has not produced the desired result because the strong absolute performance of risk assets has been eclipsed by even-faster growth in liabilities. With the era of surging liability values most likely behind us, a realistic goal today may be a relative one: outperforming the value of liabilities, by a smaller margin perhaps, but with more diversification and less risk.

2015-06-25 00:00:00 Take Shareholder Yield With a Grain of Salt by Jeff Middleswart of Ranger International

A valuation measure called “shareholder yield” has gained credence among investors of late. While shareholder yield may be a one of many useful valuation measures, we caution against overemphasizing the metric. We are particularly concerned that the measure is indifferent to whether cash flow is spent on dividends or share buybacks, the latter being a questionable allocation of capital in our view.

2015-06-25 00:00:00 Global Investing is Changing by Richard Bernstein of Eaton Vance

International investing was easy for U.S.-based investors for many years because the U.S. dollar was either declining in value or was stable. U.S. dollar-based investors’ non-US equity and fixed-income returns were generally enhanced by the falling dollar so that U.S. investors actually tended to outperform the local currency benchmarks. Of course, investment managers took credit for the resulting “alpha” despite that out performance was more likely attributable to currency than to asset selection.

2015-06-25 00:00:00 Spectacular Bid, On the Grand Stage by Michael Kayes of Willingdon Wealth Management

Comparisons are central to our society, impacting just about everything we do. Does the current economic environment measure up?

2015-06-25 00:00:00 Batteries Not Included: Midyear Stock Market Outlook by Burt White, Jeffrey Buchbinder of LPL Financial

Expect the bull market to continue through 2015. In the stock market, 2015 has felt like déjà vu. In 2014, the year began with a tough first quarter and finished strong. After a weak start to the year, we believe that corporate America will provide a much needed boost for the second half and 2015 may also finish strong?—?providing the seventh year of positive returns, in the 5?–?9% range we forecast.

2015-06-25 00:00:00 Diversification: A Better Way to Avoid Portfolio Gridlock by Tracy Fielder of Invesco Blog

Every morning as I drive into the office, I see my fellow commuters darting from lane to lane, trying to choose the fastest one. The problem is, traffic in the “fast” lane inevitably slows down as cars crowd into it, and the slower lanes suddenly become the place to be. So in the long run, despite their risky maneuvers, these drivers don’t usually get much farther ahead than anybody else.

2015-06-25 00:00:00 Yields Skyrocket! Really? by Brian Andrew of Cleary Gull

It is hard to pick up a paper, read an investment blog (mine excluded), or listen to a financial news program without hearing about the global bond market rout. Yields (interest rates) on government bonds in the U.S. and Europe have been on the rise and the financial media is trying to whip everyone into a frenzy about it. Here is why I think you should be celebrating rather than worrying.

2015-06-25 00:00:00 Building for the Future: Infrastructure in Emerging Markets by Mark Mobius of Franklin Templeton Investments

Emerging economies in general have experienced stronger economic growth trends than developed markets over the past decade, a trend that I expect to continue. That growth, combined with rising populations and a trend toward urbanization, requires more infrastructure.

2015-06-25 00:00:00 Uncertainty Now; Opportunity Later: 2015 Economic & Stock Market Outlook, Mid-Year Update by Bruce Bittles, William Delwiche of Robert W. Baird & Co.

The message at mid-year is caution now, but opportunity later. It is not difficult to envision a more constructive environment as we move through the second half. If and when the Fed finally raises rates, conviction in a gradual tightening process could raise Fed policy back to bullish, and better seasonal patterns (and perhaps improved momentum) could be in store in the fourth quarter. On the other hand, a quick return of investor optimism and/or further breadth deterioration could add downside pressure in the near term.

2015-06-25 00:00:00 Inflation Outlook: Approaching Target by Mihir Worah of PIMCO

Over the next three to five years, PIMCO expects the global economy will continue along a New Neutral path in which major economies tend to drift along at modest growth rates. At our annual Secular Forum last month, our global investment professionals rigorously debated the longer-term, or secular, outlook for the global economy and markets, and the broad conclusions we reached are detailed in “The New Neutral Revisited.”

2015-06-25 00:00:00 Invest in Tomorrow Today by Lewis Piantedosi, Yana Barton of Eaton Vance

In our view, some of the most attractive equity opportunities these days are tied to several compelling megatrends that are likely to persist over the coming years in the technology, healthcare and consumer sectors.

2015-06-25 00:00:00 The Market Continues to Vote for Japan Over Europe by Bryce Coward of GaveKal Capital

Despite Japanese stocks outperforming European stocks by 7% YTD and 14% over the last year, the investment community has continued to basically ignore Japan in the commentary we read. But, for those who have been overweight Japan it has been a good ride.

2015-06-25 00:00:00 “Ye Of Little Faith” What Has It Cost You? Part 1 by Chuck Carnevale of F.A.S.T. Graphs

I believe that one of the most important attributes that a successful investor must possess is optimism. Any serious student of financial history would recognize and acknowledge that economically speaking, things are good much more often than they are bad.

2015-06-25 00:00:00 May Real Disposable Income Per Capita Rose a Fractional 0.12% by Doug Short (Article)

With the release of today's report on May Personal Incomes and Outlays we can now take a closer look at "Real" Disposable Personal Income Per Capita.

The May nominal 0.43% month-over-month increase in disposable income drops to 0.12% when we adjust for inflation. The year-over-year metrics are 3.00% nominal and 2.77% real.

2015-06-24 00:00:00 America, China, and the Productivity Paradox by Stephen Roach of Project Syndicate

As American and Chinese leaders meet for their annual Strategic Dialogue, they need not look far to find a shared challenge. Both are now victims of the “productivity paradox”: huge investments in information technology and Internet-enabled goods and services have been accompanied by slower growth in output per worker.

2015-06-24 00:00:00 The Hot Debate Over 4% Growth In The Economy by Gary Halbert of Halbert Wealth Management

Former Florida governor and GOP presidential hopeful Jeb Bush formally announced his campaign on June 15 with a promise that, if elected president, he would return the nation to 4% economic growth.

2015-06-24 00:00:00 Putting the Pieces Together: Midyear Economic Outlook by John Canally Jr. of LPL Financial

We continue to expect that the U.S. economy will expand at a rate of 3% or slightly higher over the remainder of 2015, once economic conditions recover from yet another harsh winter—and other transitory factors—that held back growth in the early part of 2015. This forecast matches the average growth rate over the past 50 years, and is based on contributions from consumer spending, business capital spending, and housing, which are poised to advance at historically average or better growth rates in 2015. Net exports and the government sector should trail be hind.

2015-06-24 00:00:00 Handicapping Bubbles and Shocks by Kristina Hooper of Allianz Global Investors

Kristina Hooper, US Investment Strategist for Allianz Global Investors, explains the results of the 2015 Allianz Global Investors RiskMonitor Survey, a global study of prevailing views on portfolio construction, asset allocation and risk among a cross-section of institutional investors.

2015-06-23 00:00:00 The Inventor of Behavioral Finance Looks Back by Laurence Siegel (Article)

Behavioral finance is one of the great discoveries of our time, and the University of Chicago professor and investment manager Richard Thaler is one of its principal discoverers. Misbehaving is Thaler’s personal account of his discoveries, which influence the way assets are managed, policy is conducted and economic theory is understood and taught.

2015-06-23 00:00:00 Richard Thaler’s “Misbehaving” and Implications for Investors and Advisors by Joe Tomlinson (Article)

Richard Thaler is out with a new book, Misbehaving, tracing his career in behavioral economics. It offers an appealing combination of entertaining writing and serious discussion of the many areas he has researched. The book is a natural complement to Daniel Kahneman’s classic, Thinking, Fast and Slow. I’ll briefly compare these two books and then address what Thaler’s work says about two issues particularly important to financial advisors.

2015-06-23 00:00:00 How Small Mistakes Can Boost Your Credibility by Dan Richards (Article)

An advisor struggled to convert meetings with prospects into clients. Then he began describing how he’d helped existing clients in a way that made him more credible and sincere.

2015-06-23 00:00:00 How to Answer the Toughest Question Prospects Will Ask by Daniel Solin (Article)

Here's the question advisors have the most difficulty answering; and how you should answer it.

2015-06-23 00:00:00 How Likely is Hyperinflation in the U.S? Part One by Seaborn Hall (Article)

Since the great financial crisis, perhaps the most talked about scenario for the next crisis to hit the U.S. has been hyperinflation due to high levels of Treasury debt and Federal Reserve Bank liabilities. Fortunately, the logic that produces this chain of events is specious.

2015-06-23 00:00:00 The Quest for Clear Communication by Beverly Flaxington (Article)

I have a great support staff. I cringe, however, when I read some of their email responses to client inquiries. How do I coach them for clearer communication?

2015-06-23 00:00:00 Looking Beyond the Babble over Bubbles by Serena Perin Vinton of Franklin Templeton Investments

Longer term, we do not think an increase in interest rates would necessarily be a negative for equity markets, particularly because a return to normal rates would be regarded as a sign of the Fed's confidence in the strength of the US economy and its belief that the economy could stand on its own.

2015-06-23 00:00:00 Equities Gather Momentum on Positive Indicators by Robert Doll of Nuveen Asset Management

U.S. equities finished higher last week as the S&P 500 increased 0.8%, recording its highest weekly gain since April. The dovish message from Wednesday’s FOMC announcement boosted markets. Contagion from Greece appears relatively contained. The sell-off in equities in China did not impact global markets. The health care, consumer staples and utilities sectors rallied. Financials lagged as banking lost momentum and energy underperformed.

2015-06-23 00:00:00 Pickles?! by Jeffrey Saut of Raymond James

I have been traveling a lot recently and this week will be no exception as I am in Victoria, British Columbia currently and am leaving for Vancouver tomorrow. While traveling is exciting and educational, it is also exhausting. Moreover, sleeping in strange beds doesn’t help the exhaustion factor. To be sure, I often find myself suffering from dyssomnia in a fitful sleep accompanied by some pretty strange dreams.

2015-06-23 00:00:00 Stocks Are Still Cheap by Brian Wesbury, Robert Stein of First Trust Advisors

You know those TV shows – the ones about ice trucking, fishing in Alaska, or digging for gold. They’re made to bring out these interesting jobs, but also the danger. They leave you hanging, and break for commercial, just when the truck starts to slide on a bridge, or just when a huge wave is approaching.

2015-06-23 00:00:00 What Do Rising Interest Rates Mean for the Housing Market? by Brad McMillan of Commonwealth Financial Network

Today, I want to revisit a post I wrote just over two years ago. I’ve updated some of the data, but the concerns and the conclusions remain timely. In keeping with one of my recurring themes, this is also an example of how rising interest rates won’t mark the end of the world but, rather, a return to a more normal environment.

2015-06-23 00:00:00 Weighing the Week Ahead: What Does the Greek Crisis Mean for Financial Markets? by Jeffrey Miller of NewArc Investments, Inc.

The calendar shows a fair amount of economic data in the coming week, but attention is likely to be focused abroad. After many years (some would say decades) of percolating, the issue of Greece and the Eurozone is coming to a conclusion.

2015-06-23 00:00:00 Cyber Security and Terrorism: Case Studies by Kaisa Stucke of Confluence Investment Management

This week we will look at two case studies of cyber attacks aimed at sovereign nations, the Estonian cyber attacks in 2007 that spanned three weeks and the multi-faceted attacks in Georgia in 2008. We will then look at the current state of international cyber attack research, readiness and cooperation. We have had the pleasure of talking to the NATO Cooperative Cyber Defence Center of Excellence about their work and will communicate their vision and challenges.

2015-06-23 00:00:00 Central Banks Still Hold the Keys by Russ Koesterich of BlackRock

U.S. stocks and bonds were cheered last week by soothing comments from the Federal Reserve. For better or for worse, says BlackRock Global Chief Investment Strategist, Russ Koesterich, the world's central banks continue to drive market swings.

2015-06-23 00:00:00 In Investing, Have You Learned How to Let Her Go? by Jerry Wagner of Flexible Plan Investments

Whenever I’m in the car nowadays I’m always listening to satellite radio. I, like probably you, vowed I’d never pay for radio … but the constant barrage of commercials on free radio, plus the fact that Sirius comes free the first year I own my car, helped to overcome my resistance.

2015-06-23 00:00:00 Stocks: A Wary Good Sign for Bulls by Milton Ezrati of Lord Abbett

Even amid a multiyear market advance, retail equity investors remain cautious. Here’s why that could actually help extend the rally.

2015-06-23 00:00:00 Why VBINX is the Wrong Benchmark For Global Tactical Asset Allocation Strategies by Adam Butler, Michael Philbrick, Rodrigo Gordillo of BPG & Associates

We recently came across a couple of articles making the sensational claim that TAA is nothing more than a repackaged and dressed-up version of market timing. Both articles – and others, we’ve subsequently learned – point to a Morningstar study showing that TAA has underperformed the Vanguard U.S. 60/40 balanced fund over the past few years.

2015-06-23 00:00:00 Getting More from Low Market Volatility by Alex Barenboym of AllianceBernstein

Stocks still seem attractive, but it’s important to guard against a potential spike in market volatility. Today’s low-volatility environment happens to be a good time to shop for downside protection.

2015-06-23 00:00:00 Are Staples and Health Care Poised for More Outperformance? by Bryce Coward of GaveKal Capital

Today’s cyclical jolt aside, it appears from glancing at relative performance charts of growth counter-cyclicals (our code wording for the Consumer Staples and Health Care Sectors) that they could be poised for a relative performance breakout.

2015-06-22 00:00:00 Growth Or Value Leadership Depends on Fed Policy by Steven Vannelli of GaveKal Capital

The last few years have been good for growth stocks, but I think there is another observation underneath the surface as well. Growth and value leadership has pivoted on Fed policy the last five years.

2015-06-22 00:00:00 US Equity and Economic Review For the Week of June 15-19; Better News But Still A Touch Slog by Hale Stewart of Hale Stewart

Let’s start by looking at the leading indicators which were up .7. The breadth of the LEIs was very positive; there were no negative numbers while only 1 (the average work week) was 0.0.

2015-06-22 00:00:00 Greek Drama: Act 2 by Chris Brightman, Shane Shepherd of Research Affiliates

The old saying, “You can’t squeeze blood from a stone,” vividly describes the futility of trying to extract more resources from something than it has to give. The expectations the Greeks have for renegotiating their debts requires them to do exactly this, squeeze blood from a stone. Only by increasing tax collections can Greece reverse the painful reduction in government spending, services, and employment known as austerity.

2015-06-22 00:00:00 Greece Implications for Global Carry by Alexander Giryavets of Dynamika Capital L.L.C.

At least some large money managers have been seriously concerned about possible Greece implications for global asset dynamics. We briefly present one counter-intuitive and contrarian point of view on possible Greece implications for Global Carry and possible hedges and tail-hedges based on recently emerged link of Global Carry and Dollar.

2015-06-22 00:00:00 A Chinese Swap Meet by Andy Rothman of Matthews Asia

The new local bond swap program of China’s Communist Party is its latest effort to manage debt. It aims both to make the amount and structure of local government debt more transparent, and to reduce the financing burden of local government debt. Could this be considered a version of quantitative easing or a bailout? Could it lead to local government defaults?

2015-06-22 00:00:00 Global Review and Equity Commentary: May 2015 by Team of Thomas White International

The decline in U.S. economic activity during the first quarter was more than earlier estimates, and appears to have weakened business sentiment in other parts of the world. Most of the fall in U.S. aggregate output was due to temporary factors such as adverse weather and port disruptions that led to delayed export shipments. The stronger dollar also reduced the earnings growth of large U.S. corporations with a global footprint.

2015-06-22 00:00:00 Quantifying Risk by Bhavik Kothari of Diamond Hill Capital Management, Inc.

We view risk as the permanent loss of capital, and we manage risk to minimize the chances of a permanent loss of capital. In our view, risk generally falls into three broad categories – valuation risk (price that you pay), balance sheet risk (financial leverage) and business risk. While important, we believe that valuation and balance sheet risk can be mitigated through a disciplined investment process. Business risk, on the other hand, is more complex and covers many facets including competition, regulation, management execution, and capital allocation.

2015-06-22 00:00:00 All Their Eggs in Janet's Basket by John Hussman of Hussman Funds

The financial markets are establishing an extreme that we expect investors will remember for the remainder of history, joining other memorable peers that include 1906, 1929, 1937, 1966, 1972, 2000 and 2007. The failure to recognize this moment as historic is largely because investors have been urged to believe things that aren’t true, have never been true, and can be demonstrated to be untrue across a century of history.

2015-06-22 00:00:00 CEFs in a Portfolio by (Article)

Analyst Alex Reiss of Stifel shares a perspective on the role closed-end funds may play in a long-term investment portfolio.

2015-06-22 00:00:00 On My Radar: Three-Way Asset Strategy by Steve Blumenthal of CMG Capital Management Group

“The probability of loss is no more measurable than the probability of rain. It can be modeled, and it can be estimated (and by experts pretty well), but it cannot be known.”– Howard Marks, Chairman, Oaktree Capital

2015-06-22 00:00:00 Why Higher Rates Could Be Good News for Consumers by Russ Koesterich of BlackRock

Many investors worry about the impact rising interest rates could have on financial markets. It is easy to forget there is an upside: Some consumers will gain from more income and be able to spend more.

2015-06-22 00:00:00 Clarifying the Fed Policy Outlook by Scott Brown of Raymond James

There was nothing unexpected in the Fed’s monetary policy statement or in the revised economic projections of senior officials. Chair Yellen covered no new ground in her press conference. However, many investors appear to be unsure of the monetary policy outlook and the implications for the financial markets. So, to clear things up...

2015-06-22 00:00:00 Why It’s Time to Stop Reading About Robo Advisors by Patty Quinn McAuley of Clark Capital Management Group

Rather than just reading about the robos from third party sources, it’s important to do some first-hand research for yourself to truly understand the value proposition of online automated financial advice platforms.

2015-06-22 00:00:00 Gasoline Volume Sales and our Changing Culture by Doug Short (Article)

The Department of Energy's Energy Information Administration (EIA) monthly data on volume sales is several weeks old when it released. The latest numbers, through mid-April, are now available. However, despite the lag, this report offers an interesting perspective on fascinating aspects of the US economy. Gasoline prices and increases in fuel efficiency are important factors, but there are also some significant demographic and cultural dynamics in this data series.

2015-06-20 00:00:00 International Economic Week in Review: Pretty Darn Positive, Edition by Hale Stewart of Hale Stewart

As with any Fed week, this week’s news was dominated by the Federal Reserve’s policy announcement. But, after 2:15 EST on Wednesday, everybody realized nothing had changed; the Fed was still waiting for better unemployment numbers and higher inflation. In other words, the dovish stance persisted. Other US news was mixed. News from Europe was positive; the EU and UK continue expanding, the latter solidly so. Finally, Japan (finally) appears to have gotten over the sales tax problems.

2015-06-20 00:00:00 Public Pensions: Live and Let Die by John Mauldin of Mauldin Economics

I am not sure if my heart was ever that much of an open book, but I like to think I’m still relatively young. Nevertheless, I must admit that sometimes I want to “give in and cry.” This is especially so when I look at our nation’s public pension funds.

2015-06-19 00:00:00 How to Play the Fed’s Big News Day by Kristina Hooper, Steve Malin, Greg Meier of Allianz Global Investors

Although the FOMC tried hard not to make headlines, there’s still plenty to parse in its latest communications. Bonds are likely to exhibit more volatility as we near liftoff, which is likely to happen in September. And based on the Fed’s “dots” forecast, we may even see two rate hikes in 2015.

2015-06-19 00:00:00 Global Economic Perspective: June by Team of Franklin Templeton Investments

In spite of lingering concerns about Greece’s fate, the European economy would appear to have hit a sweet spot marked by steadily improving growth and inflation figures along with declining unemployment.

2015-06-19 00:00:00 Gold in the Age of Soaring Debt by Frank Holmes of U.S. Global Investors

Ever wonder how much gold has ever been exhumed in the history of the world? The GFMS Gold Survey estimates that the total amount is approximately 183,600 tonnes, or 5.9 billion ounces. If we take that figure and multiply it by the closing price on June 16, $1,181 per ounce, we find that the value of all gold comes within a nugget’s throw of $7 trillion.

2015-06-19 00:00:00 The Perils of Low Liquidity and High Leverage by Michael DePalma of AllianceBernstein

Diversify. It’s a cardinal rule of sound investing. But what’s an investor to do when a well-diversified portfolio won’t protect him? It’s time to start thinking about an answer.

2015-06-19 00:00:00 4 Healthcare REITs For A Healthier Retirement Portfolio by Chuck Carnevale of F.A.S.T. Graphs

To be considered prudent investors we must recognize and accept the undeniable reality that all true investing is done in future time. Consequently, the key to long-term investment success is to forecast the future as accurately as we possibly can. Of course, we must simultaneously recognize and accept that forecasting the future can only be accomplished within a reasonable degree of accuracy. Forecasting the future, and investing for that matter, can never be a game of perfect. Nevertheless, our investing success will ultimately be achieved based on how good our forecasts turn out to be.

2015-06-19 00:00:00 Joining the Dots: Fed Keeps Rates Unchanged While Lowering “Dots” by Liz Ann Sonders of Charles Schwab

The Federal Open Market Committee (FOMC) kept the fed funds rate unchanged from its 0-0.25% range, where it’s been since 2008. The decision was unanimous. The Fed did raise its assessment of the economy and labor market, which reinforces the view—shared by us—that the Fed will begin hiking rates in September, barring a significant change in the trajectory of the economy, jobs or inflation. It would be the first interest rate increase in almost 10 years.

2015-06-19 00:00:00 Lies, Damned Lies and Equity Skew? by Jason Goldberg of PIMCO

Equity skew, which at its most basic purports to measure the difference in the value of stock options with different strike prices, is one of the most used (and abused) sentiment measures in the equity options market. While skew measures can occasionally offer valuable information on the flows within equity derivatives, they can also be highly misleading.

2015-06-19 00:00:00 Europe in the Next Five Years by Brad McMillan of Commonwealth Financial Network

Yesterday, I talked about several major trends that are poised to at least pause (and quite possibly reverse) over the next couple of decades. One major area we didn’t discuss is Europe, which is likely to see more change in the next 5 years than it has in the past 20.

2015-06-19 00:00:00 25 Things I Wish I Learned Before I Opened My First Brokerage Account by Roger Nusbaum of AdvisorShares

Brett Arends had a great post about what he wished he’d learned before graduating high school. It was a great mix of financial nuggets, points about not wasting time or money and some other generally sound ideas. With a nod to Arends; things people should know about finance and investing before they start and should be reminded of every so often as they go along.

2015-06-19 00:00:00 Gold and Health Care Stocks Get a Clean Bill of Health by Frank Holmes of U.S. Global Investors

Even though the Federal Reserve announced this week that it would wait a little longer to raise rates, spooked investors fled to gold bullion, helping to drive prices above $1,200 an ounce. It was the greatest single-session surge by percentage in nearly a month and a half for the yellow metal, widely seen as a safe-haven investment. As I told MarketWatch yesterday, $1,200 is an important threshold for gold miners because it helps increase profitability and spur production.

2015-06-19 00:00:00 Federal Reserve, Abenomics, Trans-Pacific Partnership by Carl Tannenbaum of Northern Trust

Central banks around the world have held interest rates at or near zero for quite a while. This action was justified in the wake of the financial crisis. But there are those who think that zero, in this setting, has become a dangerous concept.

2015-06-19 00:00:00 Rising Rates Don’t Spell Doom for GRATs by Tara Thompson Popernik of AllianceBernstein

Do higher interest rates really mean the end of the golden years for grantor retained annuity trusts (GRATs)? The Wall Street Journal took this view in an article published on June 15, but we think GRATs can still play a major role in estate planning for wealthy families as rates rise—if they are structured right.

2015-06-19 00:00:00 The "Uncle Drew" Stock Market by Rob Isbitts of Sungarden Investment Research

Headline stock indexes (S&P 500, Dow, Nasdaq) continue to trade near all-time highs, and sport gaudy 5-year returns. These indexes have averaged more than 15% a year each since this time in 2010. The problem is, some investors think this is a reflection of the entire investment universe. Far from it.

2015-06-19 00:00:00 Connecting the Dots by Scott Minerd of Guggenheim Partners

A stream of positive data supports a September rate hike, but summer storms loom on the horizon.

2015-06-19 00:00:00 Northern Trust Perspective by Jim McDonald of Northern Trust

While we expect U.S. growth to see some improvement from the slow start to the year, we think optimists are likely to be disappointed at the overall pace of growth. The U.S. economy has averaged 2.2% growth since the financial crisis, and we don't see a material acceleration during the near-to-intermediate term. The prospect of a pending increase in the Fed funds rate has contributed to a rise in interest rates and strengthening of the dollar, both of which serve as a constraint on growth. We also don't see much upside to the U.S. economy through materially better growth outside the U.S.

2015-06-19 00:00:00 ECRI: "Shifting Patterns in Recessions and Recoveries" by Doug Short of Advisor Perspectives (dshort.com)

ECRI's most recent article presents slides and notes from ECRI's Lakshman Achuthan talk at the Madrid Fund Forum conference. He discussed the relationship between lower trend growth and recessions. "ECRI believes that minimally we're returning to a period of more frequent recessions, as we saw in much of the twentieth century....Going back to at least the 1970s, growth has been stair-stepping down during each successive expansion."

2015-06-18 00:00:00 Peter Lynch on Today by William Smead of Smead Capital Management

Peter Lynch was one of the most successful stock pickers of all time. From 1977-1990, he managed the Fidelity Magellan fund and produced returns of 29.2% per year, besting the S&P 500 Index returns of 15.8%. The Magellan fund grew from $18 million to $19 billion in assets during that time period. What Lynch said about market timing and investor sentiment appears very useful to long-duration common stock owners like us.

2015-06-18 00:00:00 Stock Markets Have Stalled Since March – Now What? by Gary Halbert of Halbert Wealth Management

I get asked fairly frequently what I think about the stock markets and specifically, whether I believe this unprecedented bull market can continue. My typical answer is, I don’t have a clue. I don’t understand how a country that has increased its national debt from $10.6 trillion in January 2009 (when President Obama took office) to over $18 trillion in January of this year could see its major stock markets more than double during the same period.

2015-06-18 00:00:00 When Diversification Leads You To Higher Returns by Rajat Dhar of Cogent Advisory

It is the well-known fact that diversification reduces the portfolio risk. This article, however does not cover this topic, as it has been widely discussed and deliberated upon. This article presents a case where diversification within a single sector across different scrips actually lead to the phenomenal increase in the portfolio returns. This case becomes all the more important, when we have investors sitting on the ESOPs, whose vesting period is over; and hence so not uncover the actual potential of the of Portfolio Management.

2015-06-18 00:00:00 Stop the Fed?! by Axel Merk of Merk Investments

We are concerned the Fed causes both economic and political stability to deteriorate. And, no, this is not about discouraging the Fed to hike rates. This analysis is about pointing out that the road to hell may be paved with the best of intentions. For the economy to prosper, we need a re-thinking not just at the Fed, but also with some Fed critics. Let me elaborate...

2015-06-18 00:00:00 Picking U.S. Energy, Housing and Other Credit Sectors for the Long Haul by Mark Kiesel of PIMCO

Persistent trends in economies around the world are providing opportunities for focused, long-term investors in the credit markets. Mark Kiesel, Chief Investment Officer Global Credit, discusses promising themes PIMCO sees over the next three to five years, including the U.S. energy revolution, the rising Asian consumer, the ramifications of global banking regulation and latent demand in the U.S. housing market. PIMCO’s global investment professionals gathered in May at our annual Secular Forum to discuss our long-term, or secular, views of economies and markets around the world.

2015-06-18 00:00:00 How to Find an Investment Manager Who Has the “X” Factor by Erik Ristuben of Russell Investments

The world offers no shortage of competent investment managers. Erik Ristuben explains how might you find those that seem to be “rock stars” and outperform others.

2015-06-18 00:00:00 Concerned About Rising Interest Rates? Consider These Four Alternative Investments by Walter Davis of Invesco Blog

As I travel across the country meeting with financial advisors and their clients, a common concern I hear voiced is “how can I position my portfolio for when the inevitable happens and interest rates start to rise?” In response, I state that certain types of alternative investments are well suited to help prepare portfolios for rising interest rates in the future, while also potentially adding value in the present.

2015-06-18 00:00:00 Sell The Rumor, Buy The News by Robert Kleinschmidt of Tocqueville Asset Management

Investors have been selling the rumors lately, inverting the old adage. Rumors of a Greek default and a Fed rate hike have sent investors panicking for the nearest exits. But, will they buy the news? Who knows, but they should.

2015-06-18 00:00:00 Who Would Have Guessed? Russia is the Best Performing, and Cheapest, Country Index YTD by Eric Bush of GaveKal Capital

Raise your hand if you thought Russia would be the best performing country index through roughly the first half of 2015? I imagine there aren’t too many digital hands up right now…

2015-06-17 00:00:00 WSJ Economists' June Forecasts for 10-Year Yields and the Fed Funds Rate by Doug Short (Article)

This afternoon the Fed will release the FOMC Minutes for its May meeting followed by Chair Yellen's press conference. In advance of the Fed information, let's take a quick look at a couple of items in the June Wall Street Journal survey of economists, starting with where the Federal Reserve is headed with the Fed Funds Rate, which is currently holding steady at 13 percent.

2015-06-17 00:00:00 Stocks: Keep Your Eye on the Bull by Milton Ezrati of Lord Abbett

Since the equity rally of the past few years has brought most stock indexes to new highs, investors increasingly have expressed skepticism about the possibility of future gains. It is an understandable concern—but it also is misplaced. Stocks still carry attractive valuations, if not as attractive as in past years, and so have ample ability to continue to rise, even if, as expected, the economy only lumbers along the shallow recovery path it has traveled to date.

2015-06-17 00:00:00 Corporate Tax Reform: Should You Care? by Edward Perkin of Eaton Vance

Taking all of the current tax reform efforts together, we conclude that while nothing is imminent, global corporate tax rates are likely to converge over time.

2015-06-17 00:00:00 Double Trouble for Investors? by Jerry Wagner of Flexible Plan Investments

When I think of doubles, on the positive side I think of my years of playing doubles tennis, Miguel Cabrera winning a Tigers game with one, Stevie Ray Vaughan’s Double Trouble band, and even those commercial spots that started in 1959. You know the ones I’m talking about – the Doublemint® gum commercials.

2015-06-17 00:00:00 An Alternative to Gandhi by Kaisa Stucke of Confluence Investment Management

India’s Prime Minister Modi recently made comments praising Veer Savarkar, Indian independence fighter and father of the Hindu nationalist radicalism movement. This week, we will look at the resurgence of the Hindu nationalist movement. We will start by briefly describing the political history of independent India, looking at Gandhi and Savarkar’s conflicting ideals. Next, we will look at contemporary politics and explore the Hindu movement and its likely forms under Modi’s rule. As always, we will conclude with market ramifications, both within India and for international markets.

2015-06-17 00:00:00 Weighing the Week Ahead: A Market Message for the Fed? by Jeffrey Miller of NewArc Investments, Inc.

While few expect a change in Fed policy at this week’s FOMC meeting, it will still be the center of attention. With last week’s interest rate jump, I expect the theme to be: Is the market sending the Fed a message?

2015-06-17 00:00:00 Geopolitics Will Trump Economics in Greece by John Browne of Euro Pacific Capital

Based on the continued failure of the negotiating parties to make any substantive progress in the talks over Greek debt payments, the financial world is tied up in knots over a possible Greek exit from the European Union. The uncertainty has manifested in both high and low finance, with a sharp sell-off in bonds, particularly EU and Greek government debt, and heightened retail withdrawals from Greek banks as depositors become wary of capital controls that would be imposed in the case of an exit. All concerned parties should likely breathe easier.

2015-06-17 00:00:00 Need Income? Let’s Talk by Alison Martier of AllianceBernstein

Investors and their advisors know how tough it is to generate income in today’s low-interest-rate world. Forthright and frequent conversation about how far they’re willing to go to boost returns can help.

2015-06-17 00:00:00 Rescue Me by Jeffrey Saut of Raymond James

“Rescue Me” is a song sung by Fontella Bass in 1965. The song’s refrain is “Come on, baby, and rescue me. Come on, baby, and rescue me,” a refrain that currently needs to be played on the Street of Dreams.

2015-06-17 00:00:00 GDP Forecasts: The Latest from the WSJ Economists and the Fed by Doug Short (Article)

Earlier this month the Wall Street Journal did its monthly survey of economists on a variety of economic metrics, including of course GDP. Sixty-six of the 72 economists solicited participated. Here is a look at the range of forecasts for 2015 annual GDP. We've calculated the median (middle), mean (average) and mode (most frequent). We've also documented the range of Fed forecasts in today's projections.

2015-06-17 00:00:00 Managing Risk by Investing in Dividend-Paying Stocks by (Article)

Small-cap is an asset class that has historically been associated with increased volatility. We have always believed that dividends, plentiful in the small-cap space, can help mitigate some of that risk. But what are we looking for in the dividend-paying companies in which we invest? Portfolio Manager Jay Kaplan and Co-CIO Francis Gannon discuss.

2015-06-17 00:00:00 Looking for Long-Term Growth by (Article)

Royce Smaller-Companies Growth Fund (formerly Royce Value Plus Fund) looks for growth at a reasonable price. Portfolio Managers Chip Skinner and Carl Brown discuss their criteria and the themes in which they're currently interested.

2015-06-17 00:00:00 Concentrated Funds: Benefits of a Focused Approach by Stephen Grant, Cindy Starke of Value Line Funds

Since Value Line Funds launched its first mutual fund in 1950, the investment industry has evolved considerably. To meet the needs of today’s investor, the fund family line-up has retooled in recent years, including re-branding two equity funds as concentrated portfolios of 30-50 positions. In this paper, we highlight research demonstrating the benefits of the focused approach provided by concentrated funds.

2015-06-16 00:00:00 Are Grantham and Hussman Correct About Valuations? by Larry Swedroe (Article)

For several years, well-respected financial experts such as Jeremy Grantham and John Hussman have been cautioning investors that the market, specifically the S&P 500, is vastly overvalued. Their warnings are based on the Shiller CAPE 10-year ratio compared to its long-term average. Their warnings should be taken with more than a few grains of salt.

2015-06-16 00:00:00 Gundlach: Rising Rates and Summer Insects by Robert Huebscher (Article)

You should never ask summer insects about ice, according to the Chinese philosopher Chuang Zhu, because they are bound by a single season. In the same way, many investors have never experienced a period of increasing rates. One who has, however, is Jeffrey Gundlach, who offered his forecast for rates and the one sector of the bond market that is most vulnerable.

2015-06-16 00:00:00 The Seven Dumbest Mistakes I Made as an Advisor by Robert J. Martorana (Article)

After 30 years in the advisory business, I’ve made plenty of mistakes. It is my hope that this article will help others avoid following in my errant footsteps.

2015-06-16 00:00:00 How the Wall Street Journal Can Help You Land Clients by Dan Richards (Article)

A financial advisor dramatically increased her closing rate after using a seven-question checklist from the Wall Street Journal to help prospects frame their decision making process to select an advisor.

2015-06-16 00:00:00 The Role of the Human-Touch in a Numbers Business by Beverly Flaxington (Article)

One of our clients is getting great returns but complaining more than ever. How do we get him to see the benefit of what we are doing?

2015-06-16 00:00:00 How to Use Color to Make an Impact by Daniel Solin (Article)

Most firms have marketing materials available on their websites and in hard copy. And every advisor communicates with clients via email and through periodic performance reports. I have yet, however, to meet an advisor who pays the same attention to these materials as they do to their clothes or the way their office is appointed.

2015-06-16 00:00:00 The Fed Policy Outlook: Connecting the Dots by Scott Brown of Raymond James

Policywise, not much is expected out of this week’s meeting of the Federal Open Market Committee. The FOMC is unlikely to provide a clear signal on the precise timing of the initial increase in short-term interest rates. However, there should be plenty of information in the Fed’s revised economic projections and in Fed Chair Janet Yellen’s press conference.

2015-06-16 00:00:00 One Step Closer to Normal by Russ Koesterich of BlackRock

The recent spike in interest rates, and corresponding drop in bond prices, has left longer-term U.S. bonds looking more reasonable. But will there be more rate volatility?

2015-06-16 00:00:00 Mortgage Rates At 35-Week High But Purchase Applications Picking Up by Eric Bush of GaveKal Capital

According to the Mortgage Bankers Association, for the week ending June 5th, 30-year fixed rate mortgages are the priciest they have been since October 3rd. Granted, at just 4.28%, 30-year fixed rates are historically very low but are 41 basis points higher than the low for the year.

2015-06-16 00:00:00 High Yield Bonds: Rates and Returns by Heather Rupp of AdvisorShares

With a number of data points over the past month, including Friday’s better than expected jobs report, pushing the expectations for a September rate hike higher, concerns about the impact of interest rates on various asset classes is heating up. It is important to keep in mind that if and when “rates” do rise, we are talking about the Federal Funds Rate which we expect will primarily impact the short end of the yield curve, and less so those 5-year to 10-year maturities that relate more to the high yield market.

2015-06-16 00:00:00 Take an Opportunistic Approach to the Municipal Market by Adam Weigold of Eaton Vance

The municipal market is vast: approximately 60,000 different issuers, over one million CUSIPs and about $3.7 trillion outstanding. Navigating this disparate universe is tremendously difficult for individual investors and their advisors.

2015-06-16 00:00:00 The Market for “Lemons": A Lesson for Dividend Investors by Chris Brightman, Vitali Kalesnik, Engin Kose of Research Affiliates

Central banks the world over are buying high-quality bonds, thereby removing them from the market and forcing savers to find alternative strategies to meet their income needs. In this environment of financial repression and near-zero interest rates, dividend-yield (or equity income) investing has become increasingly popular. Investors are understandably reallocating their portfolios from lower yielding bonds to higher yielding equities. But in selecting equities with a high dividend yield, investors should be aware of the risk of concentrating their portfolios in low-quality companies.

2015-06-16 00:00:00 Fed Will Kick The Can, But Shouldn't by Brian Wesbury, Robert Stein of First Trust Advisors

Wednesday – the day people have been talking about for months – is fast approaching. The Federal Reserve will announce its policy decision on Wednesday and futures markets don’t expect any change. Nonetheless, that’s a forecast of what the Fed will do, not what it should do. We think the US economy is long past the point where short-term interest rates should be held at zero.

2015-06-16 00:00:00 Rate Hikes: Investor Risk Perceptions and Historical Context by Matthew Pasts of BTS Asset Management

During a recent quarterly webcast for financial advisors, we asked the audience about their clients’ biggest concerns for the remainder of 2015. The four options were: - Losing money on their equity allocations; - Not earning enough income; - Not keeping up with the stock market; - Losing money on their fixed income allocations. Of these, “losing money on their equity allocations” was by far the most popular response, at just under 40%. In our view, bond market risks are greater than many people realize.

2015-06-16 00:00:00 Mid-Year Investment Outlook: 10 Experts on What to Watch by Orla O'Brien of Loomis Sayles

We spoke with 10 Loomis Sayles investment experts about the most pressing issues and provocative investment themes for the remainder of 2015. What are they watching? Read on for their insights.

2015-06-16 00:00:00 Stay with Equities, but Prepare for Turbulence by Robert Doll of Nuveen Asset Management

U.S. equities were up fractionally last week, with the S&P 500 Index up 0.1% as seven out of ten sectors traded higher. Strong retail sales figures kept the focus on the Federal Reserve and the prospect of higher interest rates. Concerns over Greece’s debt problems pushed volatility levels higher. The banking industry performed well, while cyclical areas of the market such as transportation lagged.

2015-06-16 00:00:00 Rising Rates and the Rebirth of Global Stockpicking by John Remmert, Donald Hubert of Franklin Templeton Investments

Once the efforts of various central banks start to bear fruit and the global economy becomes healthier, we expect to see a potential reduction in the pursuit of unconventional monetary policies. That should enable equity markets to return to what we view as a more rational level of behavior.

2015-06-16 00:00:00 June 2015 Newsletter - How's Your Temperament? by Jim Tillar and Steve Wenstrup of Tillar-Wenstrup Advisors

Markets have been churning but not really going anywhere for a while. Convincing arguments can be made that both stocks and bonds are pricey. While this doesn't mean prices will go down in the near term it does mean returns in some future periods may be more modest. It's a frustrating environment that makes investors impatient and a great time to discuss a key characteristic needed to be successful at investing.

2015-06-16 00:00:00 The Earnings Season "Scandal" by Lance Roberts of Streettalk Live

Just like the hit series "Scandal" in which a political "fixer" delves into the manipulation, deceit and obfuscation that prevails in the dark corners of Washington, D.C., so to has Wall Street's earnings. From time to time, I analyze the previous quarters earnings for the S&P 500 to reveal the "quality" of earnings rather than the "quantity" as focused on by Wall Street. One of the most interesting data points continues to the be the extremely low level of "top line" revenue growth as compared to an explosion of the bottom line earnings per share.

2015-06-15 00:00:00 Retail Sales Bounce? by Alexander Giryavets of Dynamika Capital L.L.C.

It appears this May is one of those lucky Mays when Retail Sales enjoy 2% up year-over-year seasonality adjustment without which they would have been dismal. Looking at pattern of May seasonal adjustments over the last 25 years it appears that this happened before. Interestingly, though, April plus May seasonality adjustment is twice as large as it ever been before.

2015-06-15 00:00:00 Sales Estimates Still Falling by Eric Bush of GaveKal Capital

Over the past six months, only one out 24 global industries has experienced a positive tailwind to its FY1 sales estimate. That lone industry: diversified financials. Diversified financials FY1 sales estimate has increased by 3.5%, on an equal-weighted, USD basis, over the past six months. The other 23 industries have all seen its FY1 sales estimate fall over the past six months with energy taking the biggest beating (-21%). Over the past month, zero industry have experienced increasing FY1 sales revisions and FY1 sales estimates have fallen on average by 0.8%.

2015-06-15 00:00:00 Two Pillars Support US Growth: Consumers and Corporates by Grant Bowers of Franklin Templeton Investments

While we believe the current strength in the dollar will likely persist going forward, we don’t see it as a meaningful detractor from earnings growth for many companies over the long term.

2015-06-15 00:00:00 Worried About Rising Rates? Go Global by Alison Martier of AllianceBernstein

US-only bond investors are affected by one business cycle, one yield curve, one monetary policy. As long as interest rates were falling, that was good. But it doesn’t sound so good now.

2015-06-15 00:00:00 Bank Loans & High Yield: Conscious Uncoupling is Not Just for Celebrities by Cheryl Stober of Loomis Sayles

We have long believed that the bank loan market, as represented by the S&P/LSTA Leveraged Loan Index ("All Loans"), can be thought of as a true combination of high-quality loan risk and high yield bond risk.

2015-06-15 00:00:00 Don’t Follow The News? More Like Don’t Overreact To The News by Roger Nusbaum of AdvisorShares

Tadas Viskanta has a great blog post up titled Make More By Doing (and listening) Less. The general tone of the article is the extent to which investors too frequently are influenced by stock market media enough that they make changes to their portfolio that end up being the wrong thing to have done.

2015-06-15 00:00:00 Luxury Spending in China by Winnie Chwang of Matthews Asia

Over the past decade, conspicuous consumption has been seen across China and Hong Kong, emerging as a natural by-product of an economy experiencing rapidly rising levels of affluence. Across China, there have been stories of unbelievable extravagance, from diamond-studded smartphone cases to gold-plated sport cars and replicas of homes that resemble the White House. However, these days of excessive spending in China may already have waned. Asia Weekly explores.

2015-06-15 00:00:00 A Rule of Law for Sovereign Debt by Joseph Stiglitz of Project Syndicate

To avoid economic and political instability, governments sometimes need to restructure their debts. But, in the absence of an international rule of law for doing so, the world pays a higher price than it should: a poorly functioning debt market, marked by unnecessary strife and costly delays in addressing problems when they arise.

2015-06-15 00:00:00 Credit Spreads Do Not Predict The Stock Market by Mark Ungewitter of Charter Trust Company

We keep hearing that deteriorating credit spreads are heralding an important stock market top. The chart below, covering nearly a century of market data, does not support this view. While it’s true that credit spreads have widened in 2015, this condition has occurred frequently during healthy bull markets. There are too many false positives to justify a negative outlook based on this indicator.

2015-06-15 00:00:00 Is the European Insurance Sector in a State of Emergency? by Matthieu Louanges of PIMCO

Europe’s insurance industry has responded to profound challenges with a high degree of agility and innovation on both sides of their balance sheets.

2015-06-15 00:00:00 June Economic Update by John Richards of Bronfman E.L. Rothschild

A drop in exports, poor weather, and shipping yard difficulties led the U.S. economy back into negative territory after GDP was revised downward to -0.7%. Many economists believe this is a similar situation to what we saw in 2014 with a drop in GDP during the first quarter, and a subsequent rebound in the following quarters. However, the strong dollar effect has continued into April and May and will continue to provide a headwind for GDP. The preference by consumers to save additional earnings instead of spend is also putting downward pressure on growth.

2015-06-15 00:00:00 On My Radar: Watch Out For Minus Two by Steve Blumenthal of CMG Capital Management Group

The three great essentials to achieve anything worthwhile are: hard work, stick-to-itiveness, and common sense.”– Thomas Edison

2015-06-15 00:00:00 Bonds: Can’t Live With Them, but How Do You Live Without Them? by Joe Becker of Milliman Financial Risk Management

For generations of investors, conventional wisdom regarding managing portfolio risk relied on the cardinal rule of diversification. In its simplest form, this meant holding high quality bonds in an attempt to generate income, and offset volatility and drawdowns in the stock market.

2015-06-15 00:00:00 Muni CEFs by (Article)

For “tax-driven” investors, closed-end funds featuring municipal bonds may provide an attractive opportunity, says John Cole Scott of CEF Advisors.

2015-06-14 00:00:00 US Equity and Economic Review For the Week of June 8-12; Yes, the Rally Is Getting Long In the Tooth by Hale Stewart of Hale Stewart

Although there were few economic numbers this week, what was released was positive. Retail sales bounced back and the JOLTs survey continued to show an improving labor market. But additional signs of stock market topping emerged. Ideally, the market still needs an expanding economy that translates into higher revenue growth rather than margin expansion to move meaningfully higher.

2015-06-14 00:00:00 The People’s Republic of Debt by John Mauldin of Mauldin Economics

Among the most important questions for all investors and businessmen is, how will China manage its future and the problems it faces? There are many problems, some of them monumental – and at the same time there is an amazing amount of opportunity and potential. Understanding the challenges and deciphering the likely outcomes is itself an immense challenge.

2015-06-14 00:00:00 When You Look Back On This Moment In History by John Hussman of Hussman Funds

There are moments in time when durable history is made; history that others observe much later, shaking their heads, at a loss to understand how the events that followed could not have been obvious at the time. When you look back on this moment in history, remember these things. When you look back on this moment in history, remember that spectacular extremes in reliable valuation measures already told you how the story would end.

2015-06-14 00:00:00 The War On Cash: Why Now? by Charles Hugh Smith of Peak Prosperity

Why are governments suddenly so keen to ban physical cash? The answer appears to be that the banks and government authorities are anticipating bail-ins, steeply negative interest rates and hefty fees on cash, and they want to close any opening regular depositors might have to escape these forms of officially sanctioned theft. The escape from bail-ins and fees on cash deposits is physical cash, and hence the sudden flurry of calls to eliminate cash as a relic of a bygone age—that is, an age when commoners had some way to safeguard their money from bail-ins and bankers’ control.

2015-06-12 00:00:00 Breaking from the Gold Standard Had Disastrous Consequences by Frank Holmes of U.S. Global Investors

About 100 years ago, in his testimony before Congress, banking giant J.P. Morgan famously stated: “Gold is money, and nothing else.” At the time, this was true in every sense of the word “money,” as the U.S. was still on the gold standard.

2015-06-12 00:00:00 It Pays to Be Choosy in Emerging Markets by Morgan Harting of AllianceBernstein

Emerging equities remain rich in return opportunity, in our view. But as their recent whiplash behavior illustrates, capitalizing on this potential will require far greater selectivity than it did in the past.

2015-06-12 00:00:00 What The Great Recession Taught Me About Dividend Growth Investing by Chuck Carnevale of F.A.S.T. Graphs

Ever since I first got interested in investing in stocks circa 1965 I have been confronted with a constant and persistent admonition about the next pending market crash. In those early days I contributed much of the negativity toward stocks to a lingering overhang from the Great Depression. Many of the people I was talking with had been literally traumatized by stern warnings from their parents or grandparents about the risk of investing in the stock market. Stocks were too risky for prudent people to invest in and serious money should never be invested there.

2015-06-12 00:00:00 What’s Really Behind the Sluggish Economic Recovery by Russ Koesterich of BlackRock

Russ Koesterich explains why we’re not seeing a more convincing U.S. recovery.

2015-06-12 00:00:00 The Right Food Fight by Kenneth Rogoff of Project Syndicate

The question of the extent to which governments should regulate or tax addictive behavior has long framed public debate about alcohol, tobacco, gambling, and other goods and services. And now, in the US – arguably the mother of global consumer culture – the debate has turned toward the fight against the epidemic of childhood obesity.

2015-06-12 00:00:00 Why a U.S. Jobs Report May Matter to You by Andrew Pease of Russell Investments

Andrew Pease explains what the different numbers within the latest monthly U.S. jobs report mean for investors, regardless of where their investments are currently allocated.

2015-06-12 00:00:00 Fixed income update: rate rise headwinds and value opportunities by (Article)

Fixed income markets have faced challenging conditions of late. The belief that the US Federal Reserve may raise rates this year led to a re-pricing at the more interest rate-sensitive, longer maturity end of many bond markets. Henderson’s Fixed Income team had, however, broadly repositioned in anticipation and portfolios tended to benefit as a result. In this video, Phil Apel, Head of Fixed Income, looks at the market backdrop, while Stephen Thariyan, Global Head of Credit, and Colin Fleury, Head of Secured Credit, explain where they have found value in the corporate bond…

2015-06-12 00:00:00 Alternative Investing: Two Ways to Mitigate Manager Risk by Walter Davis of Invesco Blog

Mitigating manager risk involves two things: 1. Conducting due diligence on the manager before investing. This helps increase an investor’s chances of selecting a successful manager. 2. Diversifying across multiple managers. This step helps reduce manager risk by diversifying across multiple managers.

2015-06-12 00:00:00 U.S. Economy Turns on the Afterburners-Is a Rate Hike Next? by Frank Holmes of U.S. Global Investors

So when will rates be raised again? Next Wednesday the world will tune in to see if Fed Chair Janet Yellen can answer that question. Though it's anyone's guess what she'll say, there's no denying that many of the economic indicators the Fed is keeping an eye on have sharply improved lately.

2015-06-12 00:00:00 Against this Rosy Backdrop by Scott Minerd of Guggenheim Partners

While bonds are still reasonably valued, yields have risen more than expected and seasonals appear to have turned against equities.

2015-06-12 00:00:00 Are We Mismeasuring the Economy? by Carl Tannenbaum of Northern Trust

The problem may not be with growth but rather the way we measure it.

2015-06-12 00:00:00 The Current Sideways Trading Pattern Could Go On Much Longer by Urban Carmel of The Fat Pitch

Long periods where the S&P trades sideways in a range is not unusual. There have been at least 15 similar situations in the past 35 years, about one every two years. Some of these have lasted as long as two years. Most of these have resolved with the S&P moving higher. We've been in a trading range for 7 months; settle in, this could go on much longer.

2015-06-12 00:00:00 How Investors Are Positioned Heading Into Mid-Year by Urban Carmel of The Fat Pitch

The latest data from the Federal Reserve and ICI, a company that measures equity money flows, show that US households have been aggressively adding to their equity exposure and reducing their cash. As the bull market has matured and investor confidence has increased, money has increasingly flowed to foreign equity markets, especially in 2015.

2015-06-12 00:00:00 Competitive Dynamics in the US Fund Management Industry by Steven Vannelli of GaveKal Capital

ETF Trends reported the other day that total ETF assets under management are expected to double by 2020, translating into roughly $740 billion per year of flows into ETFs (link to story here). If we look at just equity related ETFs, the growth dynamic is easy to see.

2015-06-12 00:00:00 Retired With Money To Invest? Consider Playing Defense With Utilities by Chuck Carnevale of F.A.S.T. Graphs

Prudent investors might consider investing in fairly valued utility stocks if they need income, and if they are concerned about safety and capital preservation. Utility stocks can also serve as a viable alternative for parking cash. This last point is especially relevant when the valuations of other equity options are extended as they are today.

2015-06-12 00:00:00 Luxury Spending in China by Winnie Chwang of Matthews Asia

Over the past decade, conspicuous consumption has been seen across China and Hong Kong, emerging as a natural by-product of an economy experiencing rapidly rising levels of affluence. Across China, there have been stories of unbelievable extravagance, from diamond-studded smartphone cases to gold-plated sport cars and replicas of homes that resemble the White House. However, these days of excessive spending in China may already have waned. Asia Weekly explores.

2015-06-12 00:00:00 ECRI: "Trend Real GDP Growth Is Converging to 1% a Year" by Doug Short of Advisor Perspectives (dshort.com)

ECRI's most recent article offers a compelling analysis of the relationship between GDP and two key factors: productivity and the labor force: "With productivity growth and potential labor force growth both averaging 1/2% a year, trend real GDP growth is converging to 1% a year."

2015-06-12 00:00:00 Tug of War by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

The current stalemate in the US market could continue for some time, with bouts of volatility and pullbacks expected as the market anticipates the initial rate hike. Be prepared by staying diversified and consider buying protection, but we would view such an event as the pause that refreshes and help set up the next sustainable bull run. Investors should also look overseas as the aggressive stimulus measures being taken by the ECB appear to be beneficially impacting the economy, and may help equities perform better in the coming months.

2015-06-11 00:00:00 Household Net Worth: The "Real" Story by Doug Short (Article)

Let's take a long-term view of household net worth from the latest Z.1 release. A quick glance at the complete data series shows a distinct bubble in net worth that peaked in Q4 2007 with a trough in Q1 2009, the same quarter the stock market bottomed. The latest Fed balance sheet shows a total net worth that is 54.5% above the 2009 trough and 25.2% above the 2007 peak and at an all-time high. The nominal Q1 net worth is up 2.0% from the previous quarter and up 5.7% year over year.

2015-06-11 00:00:00 Risky Business: Single-Manager Target-Date Funds by Daniel J. Loewy, Christopher Nikolich of AllianceBernstein

Target-date funds are the only big pool of assets overseen by fiduciaries that typically rely on single-manager solutions. Best practices—and our research—suggest a multi-manager approach is better.

2015-06-11 00:00:00 Stock Picks in the European Technology Sector by Steven Vannelli of GaveKal Capital

For the last five years the European technology sector has been locked in a trading range relative to the MSCI All Country World Index (USD). Recently, however, European technology stocks have been performing quite well. On an equal weighted basis, they have been the second best performing group in Europe year-to-date.

2015-06-11 00:00:00 Staying Grounded as Rates Drift Higher by Russ Koesterich of BlackRock

BlackRock Global Chief Investment Strategist, Russ Koesterich, considers ways to ride out this change in the rate regime.

2015-06-11 00:00:00 Using Investment Manager Styles to Navigate Markets by Brian Andrew of Cleary Gull

Investment manager styles, like markets, move in cycles. So as investment advisors, we try to identify where we are in the market cycle to choose the best managers. Decision making should not be binary – “I like the market or I don’t like the market,” with a resulting buy or sell decision. In downturns, the normal reaction is to sell out of the market rather than looking at how to stay in the market and become more defensive. In fact, being out of the market negatively impacts results over time.

2015-06-11 00:00:00 Global Investing is Changing by Richard Bernstein of Richard Bernstein Advisors

The global investing landscape is changing and your portfolio should as well. A strong US dollar can have significant consequences for US dollar-based investors' foreign exposure and now is the time to consider the impact currency can have in a global portfolio.

2015-06-11 00:00:00 The Market for 'Lemons': A Lesson for Dividend Investors by Chris Brightman, Vitali Kalesnik, Engin Kose of Research Affiliates

Central banks the world over are buying high-quality bonds, thereby removing them from the market and forcing savers to find alternative strategies to meet their income needs. In this environment of financial repression and near-zero interest rates, dividend-yield (or equity income) investing has become increasingly popular. Investors are understandably reallocating their portfolios from lower yielding bonds to higher yielding equities. But in selecting equities with a high dividend yield, investors should be aware of the risk of concentrating their portfolios in low-quality companies.

2015-06-11 00:00:00 IMF Urges Fed Not To Raise Interest Rates Until 2016 by Gary Halbert of Halbert Wealth Management

On Thursday of last week, the International Monetary Fund downgraded its forecast for US economic growth this year from 3.1% earlier in the year to only 2.5% now. That is not surprising in light of the mainly disappointing economic reports we’ve seen recently, and other forecasters have been revising their estimates lower as well.

2015-06-11 00:00:00 When Following the Herd is Risky, Where is the Safety? by Zachary Karabell of Envestnet

Risk and safety. Safety and risk. In investing, as in life, balancing both is an ongoing challenge. We know intuitively that all of either one or the other rarely yields the results we want, but finding the right mix is easier said than done.

2015-06-11 00:00:00 Developed Europe: Economy Trends Update April 2015 by Team of Thomas White International

After ending the year 2014 on a positive note, the Developed Europe economies gained further momentum in the early months of 2015. Between January and March, the region’s 19-country single currency bloc, the Euro-zone, expanded its GDP 0.4 percent compared to the fourth quarter of 2014 and 1 percent from the year-ago period, recording its fastest pace of growth in nearly two years. Economists and commentators though had expected GDP to increase 0.5 percent for the quarter and 1.1 percent on an annual basis.

2015-06-11 00:00:00 Do Rising Rates Mean Falling Stocks? by Brad McMillan of Commonwealth Financial Network

Yesterday, I saw an interesting doom-and-gloom piece on rising rates, which claimed that rate increases typically sink the stock market and that we could potentially expect a crash in the near future.

2015-06-11 00:00:00 The Knowledge Effect: Excess Returns of Highly Innovative Companies by Steven Vannelli, Eric Bush of GaveKal Capital

What drives stock returns? Answering this question has been a goal of investors ever since Harry Markowitz introduced his Modern Portfolio Theory in the 1950s. Later, William Sharpe’s Capital Asset Pricing Model illustrated that the market itself is the first and foremost element in explaining a stock’s performance. However, empirical research over the past several decades has identified many other effects beyond simply the market that exhibit a strong explanatory power of stock returns.

2015-06-11 00:00:00 The Fed Balance Sheet: What Is Uncle Sam's Largest Asset? by Doug Short (Article)

Pop Quiz! Without recourse to your text, your notes or a Google search, what line item is the largest asset on Uncle Sam's balance sheet?

  • A) U.S. Official Reserve Assets
  • B) Total Mortgages
  • C) Taxes Receivable
  • D) Student Loans

2015-06-10 00:00:00 Low Valuations Tough to Come By, Wherever You Look by Jennifer Thomson of GaveKal Capital

It is no secret that, whichever way we look at valuations, we think stocks are expensive. One of the more unique methodologies we employ to get a sense of where equity valuations are is to look at them grouped according to ‘buckets’ designated by pertinent levels.

2015-06-10 00:00:00 Places to Consider Riding out the Rate Regime Change by Russ Koesterich of BlackRock

With some of the classic safe havens currently providing little protection, Russ shares two stock sectors to consider as rates drift higher.

2015-06-10 00:00:00 Bears Gather Around the Goldilocks Eurozone by David Zahn of Franklin Templeton Investments

The eurozone is currently offering what we would regard as an ideal environment to generate growth, so we’d certainly be slightly concerned if the economy there was not growing.

2015-06-10 00:00:00 Energizing Returns From Dividend Stocks by Greg Powell of AllianceBernstein

Dividend cuts make unsettling headline news for income-seeking investors. But we believe that focusing on which companies will cut or raise dividends is a diversion from the search for stronger returns in a diversified equity income portfolio.

2015-06-10 00:00:00 5 Investing Myths by Lance Roberts of Streettalk Live

One of the biggest myths perpetrated by Wall Street on investors is showing individuals the following chart and telling them over the “long-term” the stock market has generated a 10% annualized total return. The statement is not entirely false.

2015-06-10 00:00:00 Jobs, Consumer Spending, Gasoline, and the Fed by Scott Brown of Raymond James

Job growth was stronger than expected in May, although figures may have been inflated a bit by the seasonal adjustment. Still, the strong job gains over the last year and the drop in gasoline prices have failed to boost consumer spending as anticipated. Following this week’s retail sales report, we may better understand why. This may have some impact on the outlook for monetary policy, but Fed officials will want to see a lot more economic data before pulling the trigger.

2015-06-10 00:00:00 U.S. Stands Out Amid Global Sluggishness by Scott Mather of PIMCO

A year ago, PIMCO said the world was in The New Neutral, as the path to recovery dragged on years after the financial crisis. Last month, at our annual Secular Forum in which our global investment professionals gathered to discuss our long-term outlook, we affirmed that thesis, and we recently published “The New Neutral Revisited” detailing and updating our views. Scott Mather, Chief Investment Officer U.S. Core Strategies, discusses how the outlook for the U.S. differs, to a degree, from other large economies.

2015-06-09 00:00:00 Can We Recover from the Public Debt Crisis? Of Course We Can by Laurence Siegel (Article)

Is the world facing a public-debt crisis, or is too much debt just another headache we will muddle through? How can investors distinguish between countries that are likely to default or otherwise injure debtholders, such as through high inflation, and those that will resolve their debt problems and emerge stronger? How can countries deal with high and rising levels of debt and return their finances to a sound footing?

2015-06-09 00:00:00 In Defense of ‘Smart Beta’ by Keith Goddard (Article)

In a recent article, Why Smart Beta is Really Dumb, Michael Edesess encouraged investors to be skeptical of the growing number of factor-based investment strategies being marketed under the moniker of "smart beta." While I applaud Edesess' call for skepticism, I am compelled to play the role of public defender and cross-examine his accusations.

2015-06-09 00:00:00 Six Words that Impress Clients by Dan Richards (Article)

We'd all like people to view us in a positive light. But few advisors take consistent advantage of six simple words that can get clients to view them more favorably.

2015-06-09 00:00:00 The Surprising Reason You Lose Business by Daniel Solin (Article)

You have a meeting with an important prospect, and you believe you have demonstrated that you are ideally suited and should be retained. You leave the meeting confident that you have won over the prospect. Subsequently, the prospect contacts you with the disappointing news; she has decided to go in another direction. What happened?

2015-06-09 00:00:00 Managing Multi-Tasking and Meeting Mania by Beverly Flaxington (Article)

I can't say if I have clinical attention-deficit disorder, but I feel like I do most days. I find myself listening with half an ear on conference calls, and I don't always give my full attention to conversations with clients. I realize I'm doing this, but I can't stop. There are so many demands on my time that I sometimes think if I don't multi-task, I can't keep up with all of it.

2015-06-09 00:00:00 The Importance of Knowing Your Ideal Client by Teresa Riccobuono (Article)

When I start working with a client, one of the first things they want me to do is help them develop a personalized marketing plan. To set the foundation for that plan, we first must determine their ideal client.

2015-06-09 00:00:00 Four Reasons Why We Do Not Hedge Against Currency Volatility by Sponsored Content from Invesco (Article)

Currency volatility has continued to be a clear theme so far in 2015. Our International Growth strategy doesn't hedge for currency exposure, and never has. In essence, the team is much more concerned with what company managements are doing than central bankers.

2015-06-09 00:00:00 Me, Lord Marlboro, and the Dow?! by Jeffrey Saut of Raymond James

Holy cow, somebody must have slipped American Pharaoh a “sugar cube” last Saturday as horse and jockey (Victor Espinoza) made the turn into the withering stretch at Belmont Park and pulled away from the rest of the pack. Hopefully, somebody will feed a “sugar cube” to the stock market this week because it certainly needs it.

2015-06-09 00:00:00 Does It Make My Portfolio Better? by Roger Nusbaum of AdvisorShares

Cliff Asness posted a commentary a few days ago that includes the following; One of the most basic lessons of investing is to think about how each investment impacts your overall portfolio not just its characteristics stand alone. You don’t evaluate your other investment options based on, “Would I trade my whole portfolio for this?” but rather on, “Does it make my portfolio better?”

2015-06-09 00:00:00 AMT doesn’t have to stand for “add more tax” by Cindy Clemson, Tom Metzold of Eaton Vance

Muni bonds exempt from Alternative Minimum Tax (AMT) may help impacted investors.

2015-06-09 00:00:00 Don't Deny The Jobs Recovery by Brian Wesbury, Robert Stein of First Trust Advisors

You would think that after 63 straight months of growth in private sector payrolls, the longest streak since the 1930s, everyone would agree that the job-market recovery is for real. But, that ain’t the case. A quick Google search still uncovers a whole bunch of pessimistic appraisals of jobs and the economy.

2015-06-09 00:00:00 U.S. Consumer: Nay, Big Spender by Milton Ezrati of Lord Abbett

The Great Recession of 2008–09 seems to have fundamentally changed the American consumer. For at least 30 years prior to that economic and financial upheaval, households in this country could only be described as financially aggressive. They spent freely, accrued debt at a rapid pace, and relegated savings to the status of an afterthought. In so doing, they helped propel rapid overall economic growth.

2015-06-09 00:00:00 Precision in Your Retirement Short Game by Glenn Dial of Allianz Global Investors

Getting the asset allocation right as plan participants close in on retirement is critical, writes Glenn Dial, Head of US Retirement Strategy at Allianz Global Investors. And professional advice can help them find that pinpoint accuracy.

2015-06-09 00:00:00 China’s Roaring Market by Edmund Harriss of Guinness Atkinson Asset Management

Chinese stock markets have roared in the past year, since May 2014. The Chinese government has announced a $40 billion “Silk Road” fund to build a network of railways and air links to bring China and Central Asia closer together; China launched the Asia Infrastructure Investment Bank in October 2014, and since then there has been a rush to join, not only from China’s neighbors, but also five of the G7 leading economies.

2015-06-09 00:00:00 The Punch Bowl Stays by Peter Schiff of Euro Pacific Capital

It is well known that I don’t think much of the ability of government officials to correctly forecast much of anything. Alan Greenspan and Ben Bernanke have made famously clueless predictions with respect to stock and housing bubbles, and rank and file Fed economists have consistently overestimated the strength of the economy ever since their forecasts became public in 2008.

2015-06-09 00:00:00 The Importance of FIFA by Bill O’Grady of Confluence Investment Management

Swiss authorities recently arrested several top officials affiliated with FIFA on various charges, mostly related to corruption. The ongoing investigation continues to unfold, so we will not spend much time on arrests or new charges. Instead, we offer a short overview of the arrests and the election and resignation of FIFA President Blatter, discussing FIFA’s structure and how the organization is prone to corruption. We follow this discussion with the most important part of the report, the extension of U.S. law enforcement into the international realm as a function of the superpower role.

2015-06-09 00:00:00 Beige Book: Window on Main Street by John Canally of LPL Financial

The latest Beige Book suggests that the U.S. economy is still growing at a pace that is at or above its long-term trend, indicating that some of the “transitory factors” that held the U.S. economy back in the first quarter of 2015 have faded and that some upward pressure on wages is beginning to emerge. Overall, the Beige Book described the economy as expanding at a “modest or moderate” pace in most districts. In general, optimism regarding the economic outlook far outweighed pessimism throughout the Beige Book, as it has for the past two years or so.

2015-06-09 00:00:00 Developments in the Reform of China’s State-Owned Enterprises by Mark Mobius of Franklin Templeton Investments

Investors’ interest in China’s SOEs has no doubt been piqued by guidance from sources close to the government that reform plans foreshadowed in the government’s November 2013 program could soon begin to assume more concrete shape, helping drive the recent gains in the Shanghai and Hong Kong share markets.

2015-06-08 00:00:00 CEF Leverage by (Article)

Leverage may increase a closed-end fund’s income, and also add to its volatility, says Chris Larsen of Legg Mason.

2015-06-08 00:00:00 Why Stocks are Not "Cheap Relative to Bonds" by John Hussman of Hussman Funds

One of the constant refrains we hear at present is that while stocks may be richly valued on an absolute basis, they are “cheap relative to bonds.” At least one professor recently told students that valuations are meaningless because the P/E on cash is 100. Technically, with T-bill yields at just 0.01%, the P/E on cash is more like 10,000, but let’s not quibble. Using simple P/E ratios or inverted interest rates as a standard of value only makes sense if you have no appreciation for how securities are valued.

2015-06-08 00:00:00 Global Tactical Asset Allocation is More than Just Market Timing by Adam Butler, Michael Philbrick, Rodrigo Gordillo of BPG & Associates

In Part 1 of this series we explored why quality TAA strategies do not rely on ‘expert’ market calls, noting that the terms ‘discretionary’ and ‘tactical’ ought not to be viewed as two sides of the same coin. Rather, the best tactical managers increasingly use systematic approaches to harvest persistent risk premia from factors such as ‘value’ and ‘momentum.’ This article will show why investors should not equate TAA with market timing.

2015-06-08 00:00:00 Is the Air Getting Thin for Japanese Stocks? by Katsuaki Ogata, Masahide Ooka of AllianceBernstein

The rapid surge of Japanese equities in recent years has left many investors worried that they may have missed the bus. We believe big changes underway can support further profitability improvements and push the market higher.

2015-06-08 00:00:00 The Quiet Financial Revolution Begins by Mohamed El-Erian of Project Syndicate

Steadily and indisputably, the financial services industry – with which we all interact, whether as borrowers, savers, investors, or regulators – has embarked on a multiyear transformation. This process, slow at first, has been driven by the combined impact of two sets of factors.

2015-06-08 00:00:00 On My Radar: “Shine Your Light Bright” by Steve Blumenthal of CMG Capital Management Group

Today, let’s take a look at the current state of inflation and the direction of interest rates and peek at a few processes that may help us better navigate the rough waters ahead. My gut says it will be the bond market that jerks the Fed’s chain. We’ll see.

2015-06-08 00:00:00 As the Economy Grows, Bonds Struggle and Equities Tread Water by Robert Doll of Nuveen Asset Management

U.S. economic data last week seemed to confirm that the country is rebounding from a weak first quarter. Manufacturing, construction, sales figures and the labor market all showed signs of improvement.

2015-06-08 00:00:00 Middle East/Africa: Economy Trends Update -- April 2015 by Team of Thomas White International

The five economies under our coverage in the Middle East and Africa region did not see any noteworthy change in their economic situations during early 2015. Soon after overcoming a long phase of industrial unrest, South Arica faced another crisis in the form of a massive power shortage. The Israeli economy slowed to a more modest pace of growth after its surge in the previous quarter while Egypt continued to benefit from low oil prices and reform initiatives by its government.

2015-06-08 00:00:00 Emerging Asia Pacific: Economy Trends Update -- April 2015 by Team of Thomas White International

During the first quarter, news from emerging Asia was dominated by the deep slowdown in China and its adverse impact on a host of other Asian economies, such as South Korea, Malaysia, Thailand, and Taiwan. In other developments, India grew faster than China, Korea saw a large decline in its exports, and Indonesia struggled to jumpstart its economy.

2015-06-08 00:00:00 Risk Revisited Again by Howard Marks of Oaktree Capital Management

In April 2014, I had good results with Dare to Be Great II, starting from the base established in an earlier memo (Dare to Be Great, September 2006) and adding new thoughts that had occurred to me in the intervening years. Also in 2006 I wrote Risk, my first memo devoted entirely to this key subject. My thinking continued to develop, causing me to dedicate three chapters to risk among the twenty in my book The Most Important Thing. This memo adds to what I’ve previously written on the topic.

2015-06-08 00:00:00 June is Out… But 2015 Lift-off Still On by Steven Vannelli of GaveKal Capital

Looking at Fed Funds futures contracts, it would appear that the fixed income market has ruled out a June rate hike but is coming back to the idea of a 2015 lift-off. Currently June fed funds future are spot on the current effective fed funds rate of 13bps. In the chart below, we plot the current effective fed funds rate, the rate implied by the June 2015 fed funds futures contract and the 10 year US Treasury Bond. Since the June contract rate and the current rate are the same, it suggests the markets have completely moved past a June rate increase.

2015-06-08 00:00:00 Billions and Billions Pour into India and China by Frank Holmes of U.S. Global Investors

It’s been a little over a year since Narendra Modi took office in India, and so far the results have been mostly positive for the South Asian country and the surrounding region. Among other achievements, Modi’s government has managed to enact important policy reforms, increase public investments in infrastructure, lower food inflation and generally open India up to business on a global scale.

2015-06-08 00:00:00 My Top 3 Fabulous Pharma Stocks by Chuck Carnevale of F.A.S.T. Graphs

I am a fervent believer that investment decisions should be made based on the relative merits of each individual investment under consideration. However, my anecdotal observations and experience suggests that many investors do not embrace that approach. This is especially true regarding investment decisions on common stocks. Instead of focusing on the opportunities and valuations available from select individual businesses, many investors are obsessed, and I allege blinded by generalized views or beliefs about the overall market and/or the economy.

2015-06-07 00:00:00 US Equity and Economic Review For the Week of June 1-5; Are the Weekly Charts Topping Out? Edition by Hale Stewart of Hale Stewart

The Federal Reserve released the latest Beige Book, which offered the following overview of the economy.

2015-06-07 00:00:00 Weekly Market Summary by Urban Carmel of The Fat Pitch

US equities have refused to become either oversold or overbought during the past several months. They are now down two weeks in a row and at point similar to where there has recently been a bounce higher. Failure to do so now would mark a change in character for this rangebound market. Ultimately, the washout low probably still lies ahead.

2015-06-06 00:00:00 Thoughts from the Frontline: Cleaning Out the Attic by John Mauldin of Mauldin Economics

My goal is to present a simple outline of the policies we need to pursue as a country in order to get us back to 3–4% annual GDP growth.

2015-06-05 00:00:00 China Reforms Create a New Muni Market by Hayden Briscoe of AllianceBernstein

Are you an optimist or a pessimist? These days, news about China seems to be mainly good or mainly bad. The market and media response to China’s local-government debt swap programme shows why maintaining a balanced view is essential.

2015-06-05 00:00:00 10 Reasons Why Growth Stocks Can Be Appropriate for Retired Investors by Chuck Carnevale of F.A.S.T. Graphs

In recent weeks I received several questions and comments from readers regarding my views on the appropriateness of investing in growth stocks in retirement portfolios. Additionally, and on a related topic, I have also come across numerous discussions, sometimes quite heated, about whether it’s best to invest for total return or growth of dividend income. Consequently, I thought it would be interesting to share my views and provide my perspectives on both the appropriateness of growth stocks, and/or whether it’s best to invest for total return or income growth.

2015-06-05 00:00:00 It’s Japan, not Europe, that Continues to Lead in 2015 by Bryce Coward of GaveKal Capital

Despite the popular news media focusing all their attention on European reflation, Draghi’s QE, Grexit or no Grexit, etc, the real story for investors remains in the seemingly forgotten Japan. Indeed, year to date Japan has outperformed Europe by more than 7% in USD terms and Portugal and Italy are the only two developed market countries to have outperformed Japan. Put another way, the largest stock markets in Europe have all underperformed Japan by a wide margin.

2015-06-05 00:00:00 Europe’s Last Act? by Joseph Stiglitz of Project Syndicate

Greece has met its creditors’ demands far more than halfway. Yet Germany and Greece’s other creditors continue to demand that the country sign on to a program that has proven to be a failure, and that few economists ever thought could, would, or should be implemented.

2015-06-05 00:00:00 Recovery Rallies, Is Six Years Enough by Craig Callahan of ICON Advisers, Inc.

Contrary to the bearish headlines, we at ICON believe that we are in the midst of a long-term recovery. With our valuation methodology as our guide, we believe there is enough value in the market to sustain a continued recovery. Furthermore, as we saw with the post 1987 market recovery, bull markets can last longer than 6 years. We believe there is still room for market growth in the current environment.

2015-06-05 00:00:00 ThinkBonds: who is buying a strong US dollar? by (Article)

The US dollar has seen a substantial rise over the last nine months. In this video we explain why we think it will remain at elevated levels and examine what this means for investors. The accepted argument for the strength of the US dollar has been economic divergence between the US and other regions, subsequently leading to a divergence in central bank policy. However, while the US economy is clearly stronger and moving at a faster pace than many peers, the likelihood of positive growth surprises elsewhere is increasing.

2015-06-05 00:00:00 Bond Tug-of-War by Anthony Valeri of LPL Financial

The bond market tried to end the month of May on a high note but did not quite make the mark. The last 10 days of May 2015 witnessed fairly steady improvement in high-quality bond prices after a difficult five weeks, but it was still not enough to offset losses for the month. The broad Barclays Aggregate Bond Index still finished 0.24% lower in May and posted consecutive monthly declines for the first time since the last two months of 2013.

2015-06-05 00:00:00 Tracking the Market with Social Media by Blair Jensen of Trade Followers

Last week the Twitter stream warned of a choppy market or a short term top. This week I’m starting to see signs of chasing by market participants. The daily momentum indicator that tracks sentiment for the S&P 500 index (SPX) on the Twitter stream is being whipped back and forth with fairly large prints (greater than +13 or less than -13). This is causing 7 day momentum to rise rapidly when the market climbs then fall rapidly when the market declines. This pattern usually indicates chasing by traders and adds instability to the market due to the indecision and quick flip flops in positions.

2015-06-05 00:00:00 Two Sides of Risk Management by Michael Armitage of Milliman Financial Risk Management

Investment returns have always found a natural place in the spotlight. But volatility, and the impact it can have on a portfolio, is only now getting the attention it deserves.

2015-06-05 00:00:00 America Is Woefully Unprepared for Retirement by Carl Tannenbaum of Northern Trust

Solutions are elusive. We cannot turn back the clock and increase our saving rates or invest with the benefit of hindsight. But from here forward, we need to take a hard look at the structure of public and private retirement systems and reinforce financial literacy among beneficiaries.

2015-06-05 00:00:00 Employment, Wages and Housing Leading The Economy Higher by Urban Carmel of The Fat Pitch

The majority of US economic data points to strength. Employment growth is the best since the 1990s. Wages and compensation are growing at the highest rates since the recession ended. And housing, both new construction and sales, are the best in 8 years. The overall economic trend remains positive.

2015-06-05 00:00:00 The Fed will Strike Out by Rob Isbitts of Sungarden Investment Research

It has been said that the most difficult thing to do in sports is to hit a Major League fastball. A small object coming toward you at 95 miles per hour, with the potential to dart down, sideways or toward your skull is certainly a skill that few can master. And many excellent athletes train all their lives, reach the Major Leagues and find out even they can’t do it. And as that sport gets more scientific, strikeout rates are rising at an alarming rate. More complexity is being thrown toward hitters and even the best in the business find it more difficult than their predecessors.

2015-06-05 00:00:00 Billions and Billions Pour into India and China by Frank Holmes of U.S. Global Investors

It’s been a little over a year since Narendra Modi took office in India, and so far the results have been mostly positive for the South Asian country and the surrounding region. Among other achievements, Modi’s government has managed to enact important policy reforms, increase public investments in infrastructure, lower food inflation and generally open India up to business on a global scale.

2015-06-05 00:00:00 Is the Yuan the New Greenback? by Russ Koesterich of BlackRock Investment Management

Given the expanding role of China's currency in international trade and finance, Russ weighs in with his outlook for the yuan.

2015-06-05 00:00:00 Those Were the Days, My Friend by Paul Kasriel of Econtrarian

Although I believe that the nature of the cause of the last recession, a financial crisis, is the principal factor accounting for the relative weakness of the current economic expansion, I also believe that the trend rate of growth of U.S. real GDP in the decades to come will be less than that in the preceding decades. The primary reason for this is related to demographics. A secondary reason is that the credit excesses that preceded the last recession will not be allowed to occur again for some time.

2015-06-04 00:00:00 Emerging Market Currencies: All About That Base by Esty Dwek of Loomis Sayles

The case for investing in emerging local currency debt over the long haul is well-documented: as developing countries improve productivity, their economies globalize and their currencies appreciate.But this is a long-term theory and the current reality may differ somewhat. Indeed, amid the current US dollar strength, many US dollar investors have been disappointed by EM local debt returns -- which have fallen more than 5% each year of the last two years. But what happens if we look at emerging market (EM) local debt returns through the lenses of different currencies?

2015-06-04 00:00:00 Strong Demand for Chicago Bonds Shows It’s No Detroit by Stephanie Larosiliere, John Loch of Invesco Blog

Moody’s Investors Service recently downgraded Chicago’s $8.1 billion of outstanding general obligation (GO) debt two notches to Ba1, officially putting the bonds in the “junk” rating category, after a May 8 ruling by the Illinois Supreme Court struck down a law overhauling state employee and teacher pensions, narrowing the city’s options for curbing growth in its unfunded pension liabilities.

2015-06-04 00:00:00 Knowledge Leaders Continued Their Outperformance In May by Bryce Coward of GaveKal Capital

Highly innovative companies outperformed again in May, continuing a streak that has been going on for quite awhile now. Whether in the developed markets or emerging markets, Knowledge Leaders have outperformed the broad DM and EM benchmarks over the last month, quarter, YTD, 1-year and since the inception of our Gavekal Knowledge Leaders Indexes.

2015-06-04 00:00:00 Why Oil Price Rally Isn’t a Surprise, but Iron Ore’s Price Should Stay Low by Tucker Scott of Franklin Templeton Investments

While oil has dealt with a relatively recent increase in supply, iron ore has been suffering through a long-term glut. And, based on our analysis of future supply/demand trends, we expect the abundance of iron ore to continue—and possibly increase.

2015-06-04 00:00:00 These Self-Made Billionaires Prove Piketty Wrong about Wealth by Frank Holmes of U.S. Global Investors

Many of us are aware that 400 billionaires appear on Forbes’ list of the wealthiest Americans. But if you had to guess what percentage of them is self-made, what would you say? A quarter? A third?

2015-06-04 00:00:00 Emerging-Market Stocks for Flywheel Fashionistas by Sammy Suzuki of AllianceBernstein

The passion for gym-to-street fashion has gone global, and shows no sign of losing vitality. It’s also keeping business humming for a network of yarn spinners, fabric mills and sneaker makers across emerging Asia.

2015-06-04 00:00:00 Recession Probability Models - June 2015 by Ted Kavadas of StratX, LLC

There are a variety of economic models that are supposed to predict the probabilities of recession. While I don’t agree with the methodologies employed or probabilities of impending economic weakness as depicted by the following two models, I think the results of these models should be monitored.

2015-06-04 00:00:00 Policy Myths: Reconnecting Investors with Useful Insights by David Robertson of Arete Asset Management

There is a great deal of useful investment research that can help make investors better off. Too often, however, it is misinterpreted or misapplied in ways that prevent investors from realizing the benefits. The role of asset allocation in the investment process is one notable example.

2015-06-04 00:00:00 U.S. Oil Production Dynamics: Now and To Come by Tim Gramatovich of AdvisorShares

In our last commentary (“Energy Markets: There Will be Winners and Losers), we gave our current thoughts on long-term US oil production and the vulnerable sub-sectors within the energy industry. So far this year, US production has been resilient even with rig counts falling over 50% from their highs and capex budgets being slashed

2015-06-04 00:00:00 China in the Spotlight by Eswarie Subrahmanyam Balan of WisdomTree

While 2014 was a challenging year for emerging markets, the story in 2015 has been substantially different so far. At a country level, both China and Russia have been primary contributors to this recovery.

2015-06-04 00:00:00 Can a Slow-Growth Environment Create Opportunities? by (Article)

Portfolio Manager Bill Hench on areas of the small-cap consumer market that he currently finds attractive, using volatility to purchase stocks at highly attractive prices, the effect a rise in rates might have on some of his holdings, and more.

2015-06-04 00:00:00 Positioned for Increased Consumer Spending by (Article)

Portfolio Managers Chip Skinner and Carl Brown on the potential benefits of current U.S. economic conditions and the investment opportunities they are creating.

2015-06-03 00:00:00 Global Tactical Asset Allocation: Just the Facts (Part 1) by Adam Butler, Michael Philbrick, Rodrigo Gordillo of BPG & Associates

We recently came across a couple of articles making the sensational claim that TAA is nothing more than a repackaged and dressed-up version of market timing. Both articles – and others, we’ve subsequently learned – point to a Morningstar study showing that TAA has underperformed the Vanguard U.S. 60/40 balanced fund over the past few years.

2015-06-03 00:00:00 Faded Photographs: Obituary Of The Bull Market by Doug Ramsey of The Leuthold Group

We’re always impressed with those lengthy, and unnaturally eloquent, obituaries that pop up online within minutes of the passing of an elderly celebrity or public figure. Such an exercise might be fun when applied to another subject, specifically, the cyclical bull market in stocks (b. 2009—d. 20XX). How will today’s bull market be viewed through the eventual clarity and objectivity of hindsight? We’ve pulled together several still frames…to maximize the effect, run each page through a fax machine to produce the nicely faded, black-and-white images that might accompany an obituary.

2015-06-03 00:00:00 Frank Sinatra on the Reinvestment of Unrealized Gains by William Smead of Smead Capital Management

In the song, “That’s Life,” Frank Sinatra tells us everything we need to know about the process of creating wealth in the stock market. We believe a little known component of creating that wealth lies in the reinvestment of unrealized gains in long duration common stock ownership.

2015-06-03 00:00:00 Our $1.3 Trillion Government-Assisted Student Loan Crisis by Gary Halbert of Halbert Wealth Management

I have been wanting to address our exploding student loan crisis for over a year now, but the topic didn’t seem to fit into the normal themes I tackle. Yet in fact, it does: It represents just one more financial/debt crisis facing our country that will surely impact the economy and the investment markets at some point.

2015-06-03 00:00:00 Greenbriar Gleanings by Jeffrey Saut of Raymond James

I always look forward to reading Frederick “Shad” Rowe’s monthly investment letter to his partners. Shad founded Greenbrier Partners, Ltd. In 1985 and has captained the investment fund ever since. He is known as one of the best “stock pickers” on Wall Street, a moniker that is well deserved.

2015-06-03 00:00:00 No Quarter: GDP Goes Into Reverse Again by Liz Ann Sonders of Charles Schwab

Although last week was shortened by the Memorial Day holiday, it was busy on the economic front. Last in, first out: The expected downward revision to first quarter real (inflation-adjusted) gross domestic product (GDP) brought it into negative territory, for a reading of -0.7%—albeit better than the -0.9% consensus expectation. More on that in a minute.

2015-06-03 00:00:00 Global Carry Mechanics and Derailment by Alexander Giryavets of Dynamika Capital L.L.C.

Global Carry (a.k.a. Risk Parity) appears to be derailed, as we cautioned in February. We observe how that happened and how Global Carry is singularly linked to Bund and US Dollar. We also refresh and reflect on our US Leading Indicator and SPX fair value.

2015-06-03 00:00:00 Are You a Carousel or Coaster Investor? by Jerry Wagner of Flexible Plan Investments

Historically, in the Midwest and Northeast, Memorial Day weekend has been the kickoff for amusement park re-openings. From rollercoasters to merry-go-rounds, the plunges and whirls begin in earnest with the unofficial beginning of summer.

2015-06-02 00:00:00 Does JPMorgan Chase Add Value For Investors? by Larry Swedroe (Article)

J.P. Morgan Asset Management has more than $318 billion in assets under management in mutual funds. But the question remains: Have their funds been adding value for investors, or has the firm itself been the real beneficiary?

2015-06-02 00:00:00 Should You Have More Fun at Work? by Dan Richards (Article)

A growing body of research suggests that creating a culture of having fun at work will attract and retain employees and increase motivation and productivity.

2015-06-02 00:00:00 Why the Housing Market Collapse is Set to Resume by Keith Jurow (Article)

New home sales are still at one-third the level of the bubble years. Existing home sales have never come close to peak-year levels. Let me explain why the housing collapse is ready to resume in earnest.

2015-06-02 00:00:00 Why Emotions and Bias Trump Facts by Daniel Solin (Article)

This interesting article on the role emotions play in making sales revealed some fascinating insights that savvy advisors can utilize.

2015-06-02 00:00:00 Is 3D Printing Following the Railway's Tracks? by Marianne Brunet (Article)

The British Railway Mania of the 1840s is considered the greatest technology hype in history. Although railroad developments were instrumental to the U.K.'s Industrial Revolution, investors ultimately overvalued the technology because they underestimated the costs associated with it. Given the growing excitement around 3D printing, is it possible that we are in for another "hype-cycle"?

2015-06-02 00:00:00 Why Decades-Old Quantitative Strategies Still Work Today by John Reese (Article)

Successful strategies continue to work long after they are created and revealed. In fact, the "guru strategy" I base on Benjamin Graham's Defensive Investor approach is one of the top-performing models on my research website despite the fact that Graham published it 65 years ago.

2015-06-02 00:00:00 How to Make Effective Sales Calls by Beverly Flaxington (Article)

I don't like making sales calls. Why would someone want to talk to me? What can I do to arrange the time and focus?

2015-06-02 00:00:00 CEFs As Complement by (Article)

Closed-end funds may be a smart way for financial advisors to complement existing portfolio strategies, says Stephen Fox of Nuveen Investments.

2015-06-02 00:00:00 State of Emerging Markets: All About Those [Central] Banks by Mark Mobius of Franklin Templeton Investments

Moving into the second quarter of 2015 and beyond, we believe a complex global background appears broadly favorable for emerging markets.

2015-06-02 00:00:00 Is ECB QE Beginning to Appear in the Data? by Team of GaveKal Capital

In addition to PMI data released today, preliminary figures for German Consumer Prices also came out– with a surprise to the upside.

2015-06-02 00:00:00 Where to Look for Yield in a Low-Yield World by Russ Koesterich of BlackRock

Russ Koesterich discusses where to look for yield in today's “low-for-long" interest rate environment.

2015-06-02 00:00:00 Profit of Doom? by Scott Brown of Raymond James

In its 2nd estimate of 1Q15 GDP growth, the Bureau of Economic Analysis published its preliminary estimate of corporate profits. No surprise, profits fell sharply in the quarter, reflecting the impact of a stronger dollar, adverse weather, and possibly statistical noise and seasonal adjustment issues. Profits are a key driver of new hiring and capital spending. Looking ahead, a lot will depend on currency market developments.

2015-06-02 00:00:00 Economic and Earnings Growth Appear Poised to Move Higher by Robert Doll of Nuveen Asset Management

U.S. equities were fairly volatile last week as investors focused on potential Federal Reserve action and concerns over Greece’s debt problems resurfaced. Merger and acquisition activity also gathered headlines in the technology and health care sectors.

2015-06-02 00:00:00 Working In Retirement Is A Hope? by Roger Nusbaum of AdvisorShares

In this scenario their nest egg increases significantly and their monthly expense goes down a fair bit and keep in mind Wheelhaus is very expensive in this realm. There is a resort in Wilson, WY that has a bunch of these from Wheelhaus, we’ve seen them first hand which is how I know about it at all and they are stunning so this sort of downsizing does not have to mean a double wide trailer at ground zero for some future tornado.

2015-06-02 00:00:00 Greece: An Update by Bill O’Grady of Confluence Investment Management

In February, we reported on the situation in Greece. Over the past few months, there has been no resolution to Greece’s debt problem, despite numerous deadlines and meetings. In our earlier report, we framed the conflict between Greece and the EU in terms of game theory. In this report, we will begin by recapping our earlier analysis. Using this framework, we will discuss how a third option has evolved which will likely force PM Tsipras to acquiesce to the EU. As always, we will conclude with potential market ramifications.

2015-06-02 00:00:00 The Fed: What Could Accelerate "Liftoff"? by Milton Ezrati of Lord Abbett

Data signaling nascent U.S. wage inflation could figure into the timing of interest-rate hikes by the U.S. Federal Reserve, even if growth in the broader economy remains slow.

2015-06-02 00:00:00 The Envestnet Edge by (Article)

With so many portfolios seeking shelter in bonds and funds constantly flowing out of equities, could the investor herd actually be reversing the areas of the markets where "safety" and "risk" reside? This month, we ask, "When Following the Herd is Risky, Where is the Safety?”

2015-06-02 00:00:00 Are Bond Investors Crying Wolf? by Niels Jensen of Absolute Return Partners

Since we last wrote to you there has been quite a dramatic increase in interest rates in most markets and in Germany in particular. In this letter we look into whether this is the beginning of something much bigger. For those of you with too little time on your hands we conclude that it is NOT. Economic growth will stay low for many years to come, and central banks have no intention of suddenly flooding the bond market with sell orders.

2015-06-02 00:00:00 Is the Stock Market Cheap? by Doug Short of Advisor Perspectives (dshort.com)

Here is a new update of a popular market valuation method using the most recent Standard & Poor's "as reported" earnings and earnings estimates and the index monthly average of daily closes for the past month. For the earnings, see the table below created from Standard & Poor's latest earnings spreadsheet.

2015-06-02 00:00:00 June Gloom Doesn't Mean Doom by Kristina Hooper of Allianz Global Investors

Kristina Hooper says bucking the conventional wisdom on summer swoons in the stock market may be a smart play, regardless of when the Fed decides to raise interest rates.

2015-06-02 00:00:00 Equity Valuations, Recessions and Stock Market Declines by Doug Short (Article)

Earlier this year I had a fascinating conversation with Neile Wolfe, of Wells Fargo Advisors, LLC. Based on the underlying data in the adjacent chart, Neile made some cogent observations about the historical relationships between equity valuations, recessions and market prices:

2015-06-01 00:00:00 Three Reasons Why We Like Brazil’s Prospects by Mark Jason of Invesco Blog

Strong headwinds in Brazil have recently blown its stock market off course. In the first quarter of 2015, Brazilian equities fell more than 15% in US dollar terms, as measured by the Bovespa Index. While current forecasts do not see these storms abating any time soon, our team finds reasons for optimism over the long term.

2015-06-01 00:00:00 US Corporate Profit Margins Are Coming Back Down To Earth by Team of GaveKal Capital

Today wasn’t the best day for US economic releases. The 2nd revision of 1Q GDP was (unsurprisingly) revised down from 0.2% to -0.7%. The release that caught our eye, however, was the initial release of corporate profits in the US for the first quarter.

2015-06-01 00:00:00 Stocks Still Have Some Room to Grow by Vadim Zlotnikov of AllianceBernstein

Stocks have been on a pretty strong run in recent years, and some investors are nervous that the market could run out of steam. We think there’s still more upside potential.

2015-06-01 00:00:00 Advice to New Graduates: Three Suggestions & One Iron-Clad Rule by Russ Koesterich of BlackRock

Russ shares his top advice for new graduates, including his favorite maxim for a successful career.

2015-06-01 00:00:00 Oil Prices: 4 Factors to Watch as Iran Increases Energy Exports by Saurabh Lele of Loomis Sayles

Iran eagerly awaits the opportunity to escalate its oil exports. A final agreement on the country's nuclear capabilities is expected this summer: sanctions will start to be peeled back and Iran will be able to increase production. Within 12 -18 months, they will likely be producing an additional one million barrels per day. It’s also likely that Saudi Arabia, now producing well above its quota, will be called on by OPEC members to reduce its production in order to accommodate Iran's higher output.

2015-06-01 00:00:00 Case for International Growth over Value Remains Strong by Team of Calamos Investments

We continue to believe investors should favor growth over value, given fundamentals, valuations and secular opportunities. International growth equities have generated higher revenue and earnings growth and delivered better capital efficiency, as reflected in a higher return on invested capital (ROIC) relative to value. Also, growth is inexpensive vs. value; growth companies are positioned to benefit from secular tailwinds; and international growth is underrepresented in stock assets.

2015-06-01 00:00:00 US Conundrum by Alexander Giryavets of Dynamika Capital L.L.C.

We observe that the US Conundrum Thesis is still in place with Global Business Cycle ongoing deceleration, European Subcycle recovery and Asian Subcycle muddling through.

2015-06-01 00:00:00 Understanding The Next 10-Years Of Low Returns by Lance Roberts of Streettalk Live

Research Affiliates, in their May newsletter, discussed the importance of "secular stagnation" and a coming decade of low returns. How low you ask? How about 1% kind of low?

2015-06-01 00:00:00 Prick Up Your Ears, People Of The World! by Sebastiao Buck Tocalino of SBTCapital Clube de Investimento

I used to draw a lot when I was growing up. My thoughts would travel on overdrive while I sketched to the sound of classic rock on vinyl. It was introspective, but very entertaining.

2015-06-01 00:00:00 On My Radar: Inflation and The Big (Bigger) Short by Steve Blumenthal of CMG Capital Management Group

"Negative-yield bonds now account for some €1.5 trillion of debt issued by governments in the euro area, equivalent to almost 30% of the total outstanding. Many expect even more of the global bond market to fall into negative yield territory. Half of all government bonds in the world today yield less than 1%.”– John Mauldin

2015-06-01 00:00:00 U.S. Core Fixed Income Performance at a Crossroad by Bradley Krom of WisdomTree

In recent weeks, longer-term borrowing costs around the world have started to rise rapidly. As a result, long only investors are now sitting on losses in their bond portfolios for the first time in 2015. This can be psychologically significant.

2015-05-31 00:00:00 US Equity and Economic Review For the Week of May 25-29; Can't Hold Onto New Highs, Edition by Hale Stewart of Hale Stewart

Clearly, this expansion has matured. Corporate after-tax earnings are slowing while the combination of the strong dollar and oil price drop is hurting industrial expansion. The lack of stimulus from the oil dividend indicates consumers still aren’t very confident, even though they have more money to spend and unemployment is nearing “full” employment levels. The markets continue to have problems holding onto new highs, which means traders are at minimum cautious about future growth prospects.

2015-05-31 00:00:00 The Liquidity Time Bomb by Nouriel Roubini of Project Syndicate

Advanced countries’ central banks have managed to keep interest rates low, reduce the volatility of bond markets, and lift many asset prices. But a series of recent shocks suggests that macro liquidity has become linked with severe market illiquidity.

2015-05-31 00:00:00 Weekly Market Summary by Urban Carmel of The Fat Pitch

The trend in US equities remains higher. But momentum is very weak and breadth suggests the uptrend is running on fumes. This is the set up as we enter June, one of the weakest months of the year for equities.

2015-05-31 00:00:00 Behold the Power of Buybacks and Dividends by Frank Holmes of U.S. Global Investors

Buybacks and dividends. The mere mention of either one is often enough to make some investors’ hearts race with excitement and embolden them with confidence that company management is being a better steward of capital.

2015-05-31 00:00:00 Reflections From a Whirlwind Tour of Asia by Carl Tannenbaum of Northern Trust

Reflections From a Whirlwind Tour of Asia; Roads and Ports are Pathways to U.S. Prosperity

2015-05-31 00:00:00 When Paper Wealth Vanishes by John Hussman of Hussman Funds

As in equal or lesser speculative bubbles across history, there’s a common delusion that elevated stock prices represent wealth to their holders. That is a fallacy, and we can hardly believe that given the collapses that followed the 2000 and 2007 extremes, investors (and even Fed policymakers) would again fall for that fallacy so readily. The actual wealth is in the cash flows that are ultimately delivered into the hands of shareholders over time.

2015-05-31 00:00:00 The S&P 500, Dow and Nasdaq Since Their 2000 Highs by Doug Short (Article)

This update is a response to a standing request from a couple of sources that we also share with regular visitors to my Advisor Perspectives pages. The request is for real (inflation-adjusted) charts of the S&P 500, Dow 30, and Nasdaq Composite. Here two overlays — one with the nominal price, excluding dividends, and the other with the price adjusted for inflation based on the Consumer Price Index for Urban Consumers (which is usually just refer to as the CPI).

2015-05-29 00:00:00 Capital Sigma: The Sum of the Various Sources of Advisor-Created Value by Jianan Du, Yinsi Qi, Brandon Thomas, Janis Zvingelis of Envestnet

An ongoing debate among investment advisors and their clients centers on value: creating it, preserving it, and perpetuating it. Each faces a different challenge: Advisors are tasked with delivering worth to their clients, and clients need to understand what they can expect for the dollars they spend.

2015-05-29 00:00:00 Three Keys Why Retired Investors Should Put Maximum Focus and Weight On Dividends by Chuck Carnevale of F.A.S.T. Graphs

In today’s low interest rate environment, prudent long-term investors, especially those in retirement, are best served by putting maximum weight and focus on dividends. There are important reasons why I support this position, and those reasons will be the focal point of this article. However, putting maximum weight and focus on dividends does not simultaneously mean at the exclusion of other important fundamental metrics.

2015-05-29 00:00:00 Can China Handle Political Satire? by Patricia Huang of Matthews Asia

Comic entertainment in China is taking some turns. But exactly what topics one can poke fun at is still a bit murky in this authoritarian state. Is China ready for political satire? Asia Weekly explores.

2015-05-29 00:00:00 Evolving Infrastructure Investing – Broader, Deeper, Global by Shundrawn Thomas, Northern Trust Asset Management, Head of Funds and Managed Accounts (Article)

Infrastructure offers an attractive combination of potential inflation hedging, income generation and long-term capital growth. In this video, Shundrawn Thomas, Global Head of ETFs, outlines the distinctive approach of FlexShares NFRA ETF.

2015-05-28 00:00:00 World War D—Deflation by John Mauldin of Mauldin Economics

Everywhere I go I’m asked, “Will there be inflation or deflation? Are we in a bull or bear market? Is the bond bulk market over and will interest rates rise?" The flippant answer to all those questions is “Yes.” And that can be the correct answer as well, but it depends on what your time frame is and what tools you use to measure the markets and inflation.

2015-05-28 00:00:00 The Importance of Liquidity by Byron Wien of Blackstone

Since the axiom “Don’t fight the Fed” came into common parlance, we have all been aware that central bank policy is an important component of market performance. Most of us started out as security or business analysts and believed that fundamental factors like the pace of the economy, earnings growth and interest rates were the drivers of equity values.

2015-05-28 00:00:00 How Much Should We Invest in Emerging Markets? by Dr. Burton Malkiel of WaveFront Capital Management

Investors today are significantly underexposed to emerging markets; fortunately, the opportunity to correct this flaw is the best in years.

2015-05-28 00:00:00 Is Now a Good Time to Add More Risk? by Alan Hartley of Black Cypress Capital Management

About this time in a market cycle, after several years of strong stock market returns, there is a tendency for investors to become more tolerant of risk. One may find his or herself questioning the reasoning behind their current asset allocation and strongly considering adding more stocks and other “risk” assets to their portfolio.

2015-05-28 00:00:00 Investing Without a Goal is Like Racing Without a Finish Line. by Jerry Wagner of Flexible Plan Investments

In investing, there is no actual finish line, unless you subscribe to the old line that, “He who dies with the most money wins.” But investing, like most activities in life, is improved by having goals.

2015-05-28 00:00:00 Tantrum Potential at Home, Opportunity Overseas by Russ Koesterich of BlackRock

U.S. equities continue to climb, but BlackRock Global Chief Investment Strategist, Russ Koesterich, discusses why the best opportunities may reside outside the United States, which, in fact, has been the case so far this year.

2015-05-28 00:00:00 Yellen on Interest Rates and Equities, Grabs Attention by Paul Eitelman of Russell Investments

Paul Eitelman compares recent comments from Fed Chair Janet Yellen to historical commentary and also provides an update on Russell Investments’ outlook on the U.S. economy.

2015-05-28 00:00:00 Valuing Stocks Requires a Human Touch by Kevin Simms, Joseph Paul of AllianceBernstein

Following pure valuation metrics today could leave equity portfolios with severe imbalances—especially in financials. But by studying patterns of the past, investors can gain insight into investing in underappreciated stocks by applying a human touch.

2015-05-28 00:00:00 Inflation Expectations Are Turning Back Over In The US by Team of GaveKal Capital

TIPS derived breakeven inflation expectations have started to fall once again in May. For a little context, starting in last June, breakeven inflation started a steady march lower that lasted until January of this year. Since that time, we have seen a rebound in inflation expectations.

2015-05-28 00:00:00 Brexit Signs: Envisioning an EU Without the UK by David Zahn, Heather Arnold, Philippe Brugere-Trelat of Franklin Templeton Investments

In my view, the big risk for the United Kingdom of exiting the EU would be marginalization, not just economically, not just financially but also politically … I would even go so far as to suggest that the status of the United Kingdom as a large world financial center could be at risk if it were to leave the EU.

2015-05-28 00:00:00 Easy?! by Jeffrey Saut of Raymond James

My father first introduced me to Justin Mamis’ work by giving me a few of the books he had written like When to Sell: Inside Strategies for Stock-Market Profits, How to Buy: An Insider’s Guide to Making Money in the Stock Market, and my favorite, The Nature of Risk. Justin penned his last stock market letter at the age of 85 and his work is missed to this day. He was a stock market historian, author, strategist, and a technician’s technical analyst. I quoted him this morning because the stock market this year has been anything but “easy.”

2015-05-28 00:00:00 Half Full or Half Empty by Herbert Abramson, Randall Abramson of Trapeze Asset Management

The ultimate question for investors. Is the glass half full, that is to say are economic backdrops improving to support attractive valuations, or to the contrary, half empty, deteriorating and threatening full valuations?

2015-05-27 00:00:00 Forecasting Q1 Second Estimate GDP: Gazing Into the Crystal Ball by Doug Short (Article)

The big economic number this week will be the Q1 Second Estimate for GDP on Friday at 8:30 AM ET. With the BEA's Advance Estimate of 0.2% behind us, what do economists see in their collective crystal ball for Q1 of 2015? Let's take a look at the latest GDP forecasts from the latest Wall Street Journal survey of economists conducted earlier this month.

2015-05-27 00:00:00 The Currency Manipulation Charade by Stephen Roach of Project Syndicate

The US Senate narrowly defeated a “currency manipulation” amendment to a bill giving President Barack Obama so-called “fast-track” authority to negotiate the controversial Trans-Pacific Partnership trade deal. But the issue could return as the debate shifts to the House of Representatives.

2015-05-27 00:00:00 The Market and U.S. Economy from a Small-Cap Perspective by (Article)

Portfolio Manager and Principal Jay Kaplan discusses current market and economic conditions and what he's hearing from company management teams, the effect energy prices are having on some of his holdings, and Royce's competitive advantage within the small-cap space.

2015-05-27 00:00:00 Collecting High-Quality Stocks for the Long Term by (Article)

Royce Premier Fund, which has more than 20 years of history, represents the firm's highest conviction stocks. CEO Chuck Royce talks with Co-CIO Francis Gannon about how the portfolio is constructed and some of the characteristics prevalent in the portfolio today.

2015-05-27 00:00:00 On My Radar: Investor Behavior, Margin Debt & The Merciless Mathematics of Loss by Steve Blumenthal of CMG Capital Management Group

As the Fed nears its tipping point, let’s take a look at investor tendencies and the risk to the market when investors are nearly “all in”. Can we safely ‘get off the Fed’s juice’? They are going to try and it’s going to get bumpy.

2015-05-27 00:00:00 Annual Cost of Healthcare for a Typical American Family of Four Approaches $25,000 by Chris Girod, Sue Hart, Scott Weltz of Milliman, Inc.

In 2015, the cost of healthcare for a typical American family of four covered by an average employer-sponsored preferred provider organization (PPO) plan is $24,671 according to the Milliman Medical Index (MMI).1 The amount will almost certainly surpass $25,000 in 2016.

2015-05-27 00:00:00 Macro Is Not the Markets: The Global Economy and the Resulting Investment Environment by Jeremy DeGroot of Litman Gregory

In a recent client Q&A event, Litman Gregory chief investment officer Jeremy DeGroot shared his thoughts on the global economy. He pointed out that, historically, macroeconomic cycles and financial-market cycles have not coincided, which has implications for asset allocation. Investors need to analyze the stock market separately from the economy.

2015-05-27 00:00:00 Don’t Fear Rising Rates — Embrace Them by Scott Eldridge of Invesco Blog

Interest rates have been on the march since late January, thanks largely to global rate markets and a looming US Federal Reserve. In general, bonds are vulnerable to falling market prices as a result of higher rates, but there are income investments that can be used to take advantage of, rather than fall victim to, rising rates. They’re known as floating rate instruments.

2015-05-27 00:00:00 The Fed Considers a More Seasoned Approach by Peter Schiff of Euro Pacific Capital

Just as the steady torrent of awful economic data, which began in the First Quarter and continued well into April and May, had forced many market analysts to grudgingly concede that 2015 would not see the robust economic growth that most had expected, the statisticians arrived on the scene like a cavalry charge and routed the forces of pessimism with a wave of their spreadsheets.

2015-05-27 00:00:00 European And Asian Stocks Are Approaching Overbought Levels by Team of GaveKal Capital

Unlike the majority of this six year old bull market, European and Asian stocks are outperforming North American stocks in 2015 (yes even measured in USD). Asian stocks are nearly 12% higher, European stocks are nearly 10% higher and North America stocks are just about 3%. This surge in Asia and European are starting to hit overbought levels judging by the the % of stocks above its 100-day and 200-day moving average.

2015-05-27 00:00:00 Global Economic Perspective: May by Team of Franklin Templeton Investments

Having come through 2015’s first quarter with virtually no growth, the US economy is generally expected to pick up during the rest of this year. Indeed, as we move into a new quarter and shake off the effects of a significant West Coast dock strike and severe winter weather, forward indicators have pointed toward better growth.

2015-05-27 00:00:00 What America Can Learn from China’s Infrastructure by Frank Holmes of U.S. Global Investors

As one of the greatest nations on the planet, the United States excels in a number of areas, innovation and entrepreneurship foremost among them. But something you might be hard-pressed to find at the top of anyone’s best-of list is infrastructure—specifically roads, rail and mass transit.

2015-05-27 00:00:00 Moment of Truth For Non-U.S. Markets by Mark Ungewitter of Charter Trust Company

The FTSE All World Ex-US index (VEU) is testing multi-year resistance in both dollar and gold terms. (See Chart 1 below.) Dollar-based investors are obviously interested in dollar thresholds, but why monitor relative strength in gold terms? Because gold provides an alternative base “currency” that measures confidence in the institutions of money and credit. A market making higher highs versus gold is exhibiting organic strength independent of local-currency devaluation or unsound credit expansion.

2015-05-27 00:00:00 The Uncorrelated by David Kleinberg of Universal Orbit

Once deemed uncorrelated, sovereign energy policies combine infrastructure development with corporate capital investment accounting for both scalability of renewable sources over the next 25 years and commodity strip pricing in the short-term. Reflecting continued private investment in public policy, simple audit of global multinational corporate profiles features integrated wind and solar operations—a dedication of business segments operations within industrial portfolios including oil and gas.

2015-05-27 00:00:00 The Slowly-Growing Economy Should Persist for Some Time by Robert Doll of Nuveen Asset Management

There was little meaningful direction in equity markets last week. Global bond yields generally rose and economic data was mixed.

2015-05-27 00:00:00 Inflation: Dormant, Not Dead by Brian Wesbury, Robert Stein of First Trust Advisors

Last month we explained why the dreaded threat of hyperinflation hasn’t materialized, and likely wouldn’t materialize, in spite of the huge expansion of the Federal Reserve’s balance sheet the past several years, including QE1, 2, and 3.

2015-05-27 00:00:00 Actively Manage Your Activist Credit Risk by Jeff Skoglund, Susan Hutman of AllianceBernstein

Bondholders fret about leveraged buyouts (LBOs) late in the credit cycle. But this time around, with new federal lending rules slowing LBO activity, shareholder activism is stealing the spotlight—and the cash flows. The threat to bond portfolios is just as serious.

2015-05-27 00:00:00 New CEF Issuance by (Article)

New issuance of closed-end funds is likely to remain “light” while questions persist regarding interest rates, says Jonathan Isaac of Eaton Vance.

2015-05-27 00:00:00 For Bond Investors, The Timing of Liftoff Matters by Kristina Hooper of Allianz Global Investors

Kristina Hooper, US Investment Strategist for Allianz Global Investors, breaks down last week's FOMC minutes and public remarks from Fed Chair Janet Yellen. Find out why the path of rate hikes and the timing of tightening both matter.

2015-05-27 00:00:00 Mr. Bleu by Bill Gross of Janus Capital Group

“It’s a spectacle of excess at the highest level”, quoted an art consultant to the N.Y. Times. Perhaps it was. Christie’s, even not counting its archrival Sotheby’s, had bagged $1 billion in sales during its May auction week – rivaling even the frenzied bidding for Manhattan high rise condos. As with high flying stocks, the logic was that the money had to go somewhere and why not a wall instead of a monthly portfolio statement.

2015-05-27 00:00:00 San Francisco Real Estate Is 75% Above Housing Crisis Lows by Team of GaveKal Capital

The latest (March) Case-Shiller Home Price Index was released this morning and there were several noteworthy data points in the report. First, our 3-month diffusion index that measures the number of cities where prices are higher now than they were three months ago increased by six cities in March to a six-month high of 18.

2015-05-27 00:00:00 Do Record Stock Highs Signal a Top? by Russ Koesterich of BlackRock

With the U.S. stock market hitting a new record high every week, are we close to the bull market's top? Russ and an investment strategist on his team, Kurt Reiman, weigh in.

2015-05-27 00:00:00 Fun with GDP by Scott Brown of Raymond James

The current economic expansion is rapidly approaching its six-year anniversary. Contrary to popular belief, the likelihood of entering a recession does not depend on the age of the expansion. However, there are other issues. In this recovery, average growth in the first quarter of the year has been well below the average of the other three quarters, leading to some doubts about the quality of the seasonal adjustment. Looking ahead, the government will introduce two new gauges with the annual benchmark revisions in late July.

2015-05-27 00:00:00 Interest Rates Affect on Intrinsic Value by William Smead of Smead Capital Management

We at Smead Capital Management believe in the value of compounded returns. They are the friend of the long-duration common stock investor, especially when considering the intrinsic value of a company. With so much chatter among investors, the media and analysts over when the Federal Reserve will increase interest rates, we would like to share with you how we think about and use prevailing interest rates in security analysis. Together with earnings growth estimates and longevity, the discount interest rate is a cornerstone of calculating the intrinsic value of a company.

2015-05-27 00:00:00 How Is Capital Spending Trending? by Milton Ezrati of Lord Abbett

The current pace of expenditures on property, plant, and equipment dampens the likelihood of an accelerated economic recovery.

2015-05-27 00:00:00 China Surpasses America As World's Largest Economy by Gary Halbert of Halbert Wealth Management

For the first time in history, the People’s Republic of China’s Gross Domestic Product exceeded the GDP of America, as measured by purchasing power, in 2014. According to the International Monetary Fund, China’s purchasing power GDP hit $17.6 trillion last year versus $17.4 trillion in the US.

2015-05-26 00:00:00 Why 'Smart Beta' Is Really Dumb by Michael Edesess (Article)

What does smart beta mean? Does it deserve the attention it is getting from the market and academia?

2015-05-26 00:00:00 The Most Important Step to Convert Prospects by Dan Richards (Article)

Most advisors using traditional mass-marketing methods without building early credibility will see heightened struggles to get a return on their effort. Fortunately, once the will and priority is in place, there are some proven models to successfully build credibility.

2015-05-26 00:00:00 The Fundamental Misunderstanding That Costs You Assets by Daniel Solin (Article)

A recent medical event involving one of my family members poignantly demonstrated the role emotions play in driving decisions. It also illustrated a fundamental misunderstanding about the decision-making process rampant among advisors.

2015-05-26 00:00:00 Disproving the Four Themes Behind Gold Bearishness by Trey Reik (Article)

The resurgent bear thesis for gold rests on four key assumptions. Because each of these assumptions is already in the process of being disproved, Western investment demand for gold will surge dramatically in coming years.

2015-05-26 00:00:00 Only the Paranoid Survive by Martin Weil (Article)

Only the paranoid survive, said Andy Grove. The quote comes to mind whenever I am talking with advisor colleagues who believe that they have little to fear from robo-advisors and the spread of technological innovation into the financial services arena.

2015-05-26 00:00:00 The Best Way to Train New Employees by Beverly Flaxington (Article)

Some of my coworkers believe we should put on a sales hat and try and "sell" our new hires on how great we are. Others think we should stick purely to the facts and just say this is what we do and how we do it. Any perspective on what's better?

2015-05-26 00:00:00 Senior Loan CEFs by (Article)

Senior loan CEFs may appeal to “defensive” income investors, but don’t expect immediate payoff, says Ken Fincher of First Trust Advisors.

2015-05-25 00:00:00 US Equity and Economic Review For the Week of May 18-22; Housing Rebounds But the Markets Continue G by Hale Stewart of Hale Stewart

Last week’s fundamental news was encouraging. Although we’re still in a shallow industrial recession, other sectors of the economy are printing solid results. However, large multi-nationals face sufficient headwinds from a strong dollar, weak international environment and declining oil prices to prevent a sustained advance.

2015-05-25 00:00:00 Voting Machine, Weighing Machine by John Hussman of Hussman Funds

The fact is that valuations drive long-term returns, but over shorter horizons, stock prices are the result of whatever investors collectively believe, however reckless or detached from historical evidence those beliefs may be. As long as enough market participants are attached to the idea that risk is their friend (or enemy) regardless of the price, there is no natural limit to how overvalued (or undervalued) stocks can become. There is only one way to address this: measure investor risk preferences directly through observable market internals.

2015-05-23 00:00:00 Western Drought to Hurt or Help Housing? by John Burns of John Burns Real Estate Consulting

While the drought throughout the Western US has created a lot of concern, it turns out that a number of companies and water districts were prepared, having invested in all sorts of technologies and water recycling programs. In fact, new homes and new home communities are far more water efficient than existing communities.

2015-05-23 00:00:00 Rate Hike Ahead? Here’s How to Get Your Portfolio Ready by Frank Holmes of U.S. Global Investors

Many experts and analysts believe a June rate hike seems very unlikely, but today, Federal Reserve Chairwoman Janet Yellen hinted that one might happen as soon as the end of this year.

2015-05-23 00:00:00 The Strong Dollar’s (Real) Toll on Tech Stocks by Heidi Richardson of BlackRock Investment Management

While the stronger dollar certainly did hurt technology sector earnings, the currency's impact wasn't as bad as predicted, and the case for US tech remains strong.

2015-05-23 00:00:00 Can Emerging Markets Survive Lower Commodity Prices? by Carl Tannenbaum of Northern Trust

Can Emerging Markets Survive Lower Commodity Prices?; Some Central Banks Are Playing the Market; Australia – Real Estate Is Too Frothy for Regulator’s Tastes

2015-05-23 00:00:00 The Affordable Care Act and Low Interest Rates: A One-Two Punch for Health Insurance Portfolios by Chitrang K. Purani and Georgi Popov of PIMCO

Two common themes emerged from a recent PIMCO survey of U.S. health insurers: Underwriting performance will be a larger factor in asset allocation, and there will be more emphasis on liquidity and income. For now, health insurers generally expect increased premium volumes and shifts in insured profiles as a result of the Affordable Care Act. Re-examining investment policies and tiering liquid assets can help investment portfolios maintain flexibility while potentially contributing more to the bottom line.

2015-05-23 00:00:00 GDP Seasonal Adjustment: There's No Smoking Gun by Urban Carmel of The Fat Pitch

First quarter GDP growth was stronger than originally estimated. When adjusted for seasonality, the economy grew 1.8%, which is consistent with the average growth rate over the past three years. It is also consistent with a wide variety of economic data (employment, wages, housing, consumption) released in the past several months. And, finally, it is consistent with the message being sent by the treasury market.

2015-05-23 00:00:00 Investor Opinions Have Become Extremely Uniform, And That's Not Good by Urban Carmel of The Fat Pitch

Investor opinions have become extremely uniform. By some measures, they are the most uniform in 25 years. In the past, this has corresponded to a period where equities have lacked significant upside momentum. That appears to be a quite likely outcome until investors become more varied in their market outlook than they are today.

2015-05-23 00:00:00 Northern Trust Perspective by Jim McDonald of Northern Trust

Our monthly Perspective newsletter keeps you apprised of current market and economic conditions across an array of topics including: US, European and Asian markets, global real estate and commodities.

2015-05-23 00:00:00 ECRI: "Fed Rate Hike May Be Postponed Due to Inclement Data" by Doug Short of Advisor Perspectives (dshort.com)

Friday's release of the publicly available data from the Economic Cycle Research Institute (ECRI) puts its Weekly Leading Index (WLI) at 133.9, down slightly from 134.6 the previous week. The WLI annualized growth indicator (WLIg) is at 1.5, up from the previous week's 1.2, and off its interim low of -4.7 in mid-January.

2015-05-23 00:00:00 The Great Beta Hoax: Not an Accurate Measure of Risk After All by Chuck Carnevale of F.A.S.T. Graphs

Beta is a rearview mirror statistic that is based solely on an analysis of its price history. To the prudent fundamental oriented value investor, statistics can never substitute for serious analysis and due diligence. Comprehensive research based on fundamentals will serve investors far better in the long run.

2015-05-23 00:00:00 Schwab Market Perspective: As the World Turns by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

A market that grinds higher isn’t all bad as it allows time for earnings to catch up to prices; but complacency must be reined in. Sharp movements could and should come as we move closer to a potential Federal Reserve rate hike. We believe the US economy will rebound from the weak soft first quarter, helping to support stocks and a rate hike, but the turn needs to gain traction. Meanwhile, Congressional approval of fast track trade authority could pave the way for improvements in the Japanese recovery.

2015-05-22 00:00:00 The Big Four Economic Indicators by Doug Short (Article)

Official recession calls are the responsibility of the NBER Business Cycle Dating Committee, which is understandably vague about the specific indicators on which they base their decisions. This committee statement is about as close as they get to identifying their method.There is, however, a general belief that there are four big indicators that the committee weighs heavily in their cycle identification process. We are now tracking each of the four at the following individual links:

2015-05-21 00:00:00 China: A Great Wall of Worry by Milton Ezrati of Lord Abbett

Beijing likely will find a way to mitigate the effects of a slowing economy and soaring debt levels—but the risks are high.

2015-05-21 00:00:00 Global Review and Equity Commentary: April 2015 by Team of Thomas White International

As expected, the global economy slowed during the first quarter but should gain momentum in the coming months. The U.S. economy almost came to a standstill during the first three months of the year as adverse winter weather limited activity. Consumer spending moderated and construction activity slowed, while lower oil prices discouraged businesses in that sector from capital investments. The stronger dollar and labor disputes at some of the seaports limited export gains, and led to a widening of the U.S. trade deficit.

2015-05-21 00:00:00 Quality on Sale by Adam Peck of Heartland Advisors

Investor indifference toward strong balance sheets and cash flow has created opportunities in today’s market.

2015-05-21 00:00:00 Forward Guidance Is Back at the Bank of England by Mike Amey of PIMCO

The central bank seeks to reassure markets about its policy intentions and also stabilise gilt yields ahead of an anticipated rate hike in the U.S.

2015-05-21 00:00:00 The Student Debt Dilemma and the Role of 529 Plans by Roger Michaud of Franklin Templeton Investments

While loans can be useful in bridging the gap between savings and final costs, a college degree doesn’t have to come with a mountain of debt. Develop a multi-pronged strategy, and hopefully you or your children can enjoy the fruits of a college education for decades to come.

2015-05-21 00:00:00 The (Investment) World Is Changing And You Need To Get On Board by Roger Nusbaum of AdvisorShares

Fast Company posted an article that looked at existing jobs that are likely to change dramatically or disappear altogether over the next ten years. Change happens of course often spurred along by technology and/or innovation.

2015-05-21 00:00:00 Summer Breezes, Summer Squalls by (Article)

Bill McQuaker, Co-Head of Multi-Asset, gives his views on recent market shake out and explains why he expects a change in tone for the months ahead. Speaking on 5/19/15, Bill explains that the clear trends and consensual trades of late are unlikely to return through the summer months as confidence takes time to recover and outlines how he has repositioned accordingly.

2015-05-21 00:00:00 Factoring in Politics when Investing by Robert Harvey of Matthews Asia

Factoring in political backdrops typically makes investment decisions more complex. What should investors consider in trying to mitigate political risk?

2015-05-21 00:00:00 What a Rate Hike May Mean for Stocks by Russ Koesterich of BlackRock

Russ looks back at equity performance following past rate increases to gauge what could be ahead for investors.

2015-05-21 00:00:00 Smart Money Most Committed to Falling Rates Since The Last Peak in Long Bond Yields by Team of GaveKal Capital

Commercial traders (AKA the smart money) has massively flip flopped their positioning since the end of last year with respect to the long bond. In aggregate, commercial traders have moved from a net short position (benefiting when rates rise) of about 50K derivative contracts to a net long position (benefiting when rates fall) of 22K contracts.

2015-05-21 00:00:00 Is an Index Impassive? by Dianne Lob of AllianceBernstein

Passive investments continue to gain popularity, generate record flows and grab headlines. We understand the appeal. But investors must also consider some of the risks of tethering their fortunes to a benchmark.

2015-05-21 00:00:00 The 3 R's of a Winning Retirement Plan by Glenn Dial of Allianz Global Investors

There's a new paradigm for enhancing plan design, and therefore improving outcomes for plan participants, writes Glenn Dial, Head of US Retirement Strategy at Allianz Global Investors. It's not just about the 3 F's anymore (fiduciary responsibility, fees and funds). Learn why you should look to the 3 R's instead: results, reliability and risk.

2015-05-21 00:00:00 Slow Growth: A Tale of Two Theories by Shane Shepherd of Research Affiliates

Global demand is dragging. Savings far exceeds investment. The combination is a surefire recipe for long-term low to negative growth in the developed markets—and core U.S. asset returns of 1% or lower over the next decade.

2015-05-21 00:00:00 Our May 2015 Market Commentary by Adam Jordan of Paul R. Ried Financial Group

We could spend this letter going into detail on the topics du jour, such as if/when we think the Fed will finally raise interest rates (they will...eventually). Or whether Greece will leave the Euro (they probably will...eventually). Or what we think of China’s growth (It will continue slowing...Slowly).

2015-05-21 00:00:00 A Pivotal Year for ASEAN? by Mark Mobius of Franklin Templeton Investments

The role of Asian markets in the global economy has grown significantly in recent years, and we expect this trend to continue in the future. Many of these countries have also made fundamental improvements to their economies, and we think these changes are here to stay. This year could prove a pivotal one for a number of countries in Asia, as the Association of Southeast Asian Nations (ASEAN) had set ambitious plans for a new ASEAN Economic Community (AEC) to come to fruition in 2015.

2015-05-21 00:00:00 Time to Go Active by Heather Rupp of AdvisorShares

Earlier this week we saw one of the major financial publications feature an article about how active management has outperformed passive management so far in 2015. While their article and data focused on equity funds, we believe that the same sort of opportunity for active fixed income managers exists over the balance of 2015.

2015-05-21 00:00:00 Longer Term Trends Have Reasserted Itself In May by Team of GaveKal Capital

Remember back in April when we noted how equity trends had completely flip-flopped during the first several weeks of the second quarter and we wondered aloud whether this was a trend change or simply a counter-trend rally? Well, so far in May the market is signalling that equity trends observed in April may have just been oversold (and well overdue) bounce.

2015-05-21 00:00:00 China Bonds Still Offer Opportunities by Hayden Briscoe of AllianceBernstein

As more corporate bond issuers in China run into financial trouble, investor anxiety about the possibility of a broader market collapse has understandably increased. We don’t think it’s time to man the lifeboats, however; on the contrary, we believe that Chinese bonds still offer good opportunities for research-driven investors.

2015-05-21 00:00:00 The Great Beta Hoax: Not an Accurate Measure of Risk After All by Chuck Carnevale of F.A.S.T. Graphs

Every investor is concerned with risk at some level. Arguably investors in retirement are and should be concerned with risk the most. However, not every investor looks at or defines risk in the same way. In truth and fact, there is a wide gap between how various segments in the financial community define and view the complex subject risk.

2015-05-20 00:00:00 A New Look at the Total Return Roller Coaster by Doug Short (Article)

Here's an interesting set of charts that will especially resonate with those of us who follow economic and market cycles. Imagine that five years ago you invested $10,000 in the S&P 500. How much would it be worth today, with dividends reinvested but adjusted for inflation? The purchasing power of your investment has increased to $18,300 for an annualized real return of 12.15%.

2015-05-20 00:00:00 The Idolatry of Interest Rates Part I: Chasing Will-o’-the-Wisp by James Montier of GMO

First is the idolatry of the “equilibrium/natural/neutral” rate of interest displayed by central bankers around the world. The second idolatry is the modern-day belief in the world’s greatest con: that monetary policy matters.

2015-05-20 00:00:00 The Economic Consequences of Mr. Osborne by Niall Ferguson of Project Syndicate

In the wake of the 2010 British election, Keynesians like Robert Skidelsky predicted that Chancellor of the Exchequer George Osborne was gravely wrong in seeking to reduce the budget deficit. It turns out that it is the Keynesians who were mistaken, with the main question being why they refuse to admit it.

2015-05-20 00:00:00 Economy is "Good Enough" for Stocks by Russ Koesterich of BlackRock

With economic data remaining mixed, BlackRock Global Chief Investment Strategist, Russ Koesterich, discusses why investors should continue to favor stocks over bonds.

2015-05-20 00:00:00 China is Choking on its Own Debt by Joseph Taylor of Loomis Sayles

We have it on good authority. And in this case that authority is an unlikely source – the People’s Bank of China (PBoC). It’s difficult to remember the last time so many paid so little attention to something so vitally important. The revelation came in the bank’s release of its 1Q 2015 Monetary Policy Report on 8 May 2015.

2015-05-20 00:00:00 Recession Check: Updating The Indicators by Lance Roberts of Streettalk Live

In December of 2007, I wrote in my weekly newsletter that we were "...either in, or about to be in, the worst recession since the 'Great Depression.'" At that time, the warning rang hollow as GDP growth was positive, and the markets were still marching higher as the calendar turned to 2008. It was a year later, in December of 2008, that the National Bureau of Economic Research (NBER), stated that the recession did, in fact, begin in December of 2007.

2015-05-20 00:00:00 Why US Economic Growth May Disappoint Again In 2015 by Gary Halbert of Halbert Wealth Management

Our main topic today is how the US economy continues to disappoint expectations, and 2015 looks to be no exception. Forecasts for GDP growth this year continue to be downgraded, and there is at least a small possibility that the US economy is slipping into recession.

2015-05-20 00:00:00 Back to the drawing board by Scott Brown of Raymond James

The data reports for April suggest that the second quarter’s anticipated rebound from a weak 1Q15 will fall far short of expectations. We could get revisions, figures for May and June could be a lot stronger, but at face value, the economy has disappointed. However, the Fed is still on track to begin raising short-term interest rates later this year. We should come away with a better understanding of how the Fed sees the situation when the central bank’s two top officials speak later this week.

2015-05-20 00:00:00 Can We Really Trust Nike’s Stock Price? by Chuck Carnevale of F.A.S.T. Graphs

One of the most common mistakes that I see common stock investors make is failing to formulate the important distinction between a company and its publicly traded stock. There are many great companies out there with fabulous stories surrounding their wonderful businesses. As a result, it can be very easy to fall so much in love with a great company that you can’t resist investing in the stock even when the valuation is extreme.

2015-05-20 00:00:00 Breakdowns in the Health Care Sector by Team of GaveKal Capital

Health care stocks have been the leadership sector in the MSCI World, and many (such as biotech) have reached some pretty elevated valuations. Most stocks in the sector have been in multi-year bull markets trends, outperforming the MSCI All Country World Index significantly.

2015-05-20 00:00:00 Reducing Inflation Risk During Retirement: The Compelling Case for Stocks by Joe Becker of Milliman Financial Risk Management

In April 2005, (when interest rates were arguably more normal than they’ve been during the low-rate, post-crisis economy, steered by the Federal Reserve) an investor could have purchased a 10-year Treasury bond with a yield to maturity of 4.4%. That represented an attractive boost over the dividend yield of the S&P 500 Index, which at the time was 1.9%.

2015-05-19 00:00:00 Career Center by Various (Article)

Find career opportunities for firms that seek to add financial advisors and planners to their staff. Read more to find out how to post opportunities at your firm.

2015-05-19 00:00:00 Gundlach - Beware of CNBC Pundits by Robert Huebscher (Article)

On issues as central as the effect of quantitative easing or Fed tightening on interest rates, Jeffrey Gundlach says you shouldn't trust the pundits on CNBC.

2015-05-19 00:00:00 Do Goldman Sachs' Funds Add Value for Investors? by Larry Swedroe (Article)

Over the last few years, an expanding line of mutual funds created by commercial banks such as Goldman Sachs and JPMorgan Chase have been drawing billions of dollars from investors looking to earn a good return. While the fees these funds have generated are among the few consistent bright spots of growth on Wall Street, the question for investors is whether or not the active mutual funds managed by these banks actually have been good investment choices.

2015-05-19 00:00:00 The Question That Qualifies Prospects by Dan Richards (Article)

Most advisors qualify prospects by their net worth or level of assets. But there's a better test of whether someone is a legitimate prospect.

2015-05-19 00:00:00 Happiness is a Choice by Daniel Solin (Article)

Why do so many highly intelligent people with good paying jobs act in a way that is so obviously not in their best interests?

2015-05-19 00:00:00 Financial Strategies for LGBT Couples by Holly Hanson (Article)

When talking with clients about the merging of their life with another person and financial strategies to help protect them, LGBT individuals and couples are subject to more complex considerations than heterosexual couples. In this article, I've broken down some of the most common questions that these specific individuals ask when it comes to setting up accounts and documentation within the relationship.

2015-05-19 00:00:00 Selling for the Non-Sales Professional by Beverly Flaxington (Article)

Here are three key areas to focus on if you want to increase your selling acumen but stay comfortable doing it your own way.

2015-05-19 00:00:00 APViewpoint reaches 5,000 advisor-member milestone by Jeff Briskin (Article)

Advisor Perspectives is pleased to announce that APViewpoint has achieved an important milestone of enrolling its 5,000th member in its first year of operation. APViewpoint is a free online community for financial advisors and financial planners.

2015-05-19 00:00:00 Monetary Movements & Economic Mirage by Team of GaveKal Capital

While we entered 2015 with the Federal Reserve talking confidently about lift-off and how many rate increases there would be by the end of the year, the markets didn't seem to buy it. As weak economic data began to surface, the Fed seemed to quietly backtrack first on the date of lift-off and then on the trajectory of the expected hiking cycle.

2015-05-19 00:00:00 Active Equities Don’t Have to Be Riskier by Kent Hargis, Chris Marx of AllianceBernstein

Many investors are throwing in the towel on active equity management in the name of evading risk. But being active doesn’t always mean accepting higher risk. Consider, for instance, the benefits of even-tempered stocks.

2015-05-19 00:00:00 Crescendo or Consolidation? by Jeffrey Saut of Raymond James

The S&P 500 (SPX/2122.73) has basically been locked in a trading range between 2040 and 2100 since early February of this year. Some technical analysts term the subsequent chart pattern a wedge and others call it a rising wedge. While pundits can debate the difference between the two, the important point is which way said chart pattern will be resolved with either an upside breakout, or a downside breakout.

2015-05-19 00:00:00 Devil Inside: Dissecting the Most Popular Valuation Metrics by Liz Ann Sonders of Charles Schwab

Given that first quarter earnings season is largely in the books—and since it’s been a couple of years since I wrote comprehensively about valuation—I am tackling it again this week.

2015-05-19 00:00:00 On My Radar: Valuations and Forward Return by Steve Blumenthal of CMG Capital Management Group

This week let’s take a look at current market valuations (high) and what they are telling us about probable 10-year forward returns (low).

2015-05-19 00:00:00 Equities Push Ahead Despite Softening Economic Growth by Robert Doll of Nuveen Asset Management

The continued advance in global bond yields dominated the financial story again last week, although this trend eased slightly by the end of the week. Economic data featured a relatively weak retail sales report.

2015-05-19 00:00:00 Rates and Returns, 2013 versus 2015 by Heather Rupp of AdvisorShares

Given the recent move in Treasury yields, with the 10-year U.S. Treasury yield up over 30bps in just the last 30 days, the concern about interest rate risk is heating up again.

2015-05-19 00:00:00 Taxes Culprit Behind Slow Sales by Brian Wesbury, Robert Stein of First Trust Advisors

Last week’s report on retail sales in April came in weaker than most economists expected, with no change from the pace of sales in March. As a result, the chorus calling for the Federal Reserve to postpone the start of rate hikes beyond June, already loud, grew even louder.

2015-05-19 00:00:00 On the Road to Normal by Charlie Dreifus of The Royce Funds

While conflicting signs of economic strength are, for the time being, stalling a rise in rates, Portfolio Manager Charlie Dreifus continues to believe that active stock picking remains an attractive approach in the current environment.

2015-05-19 00:00:00 U.S. Economy: A Variable-Speed Recovery by Milton Ezrati of Lord Abbett

A flat first quarter likely will be followed by one or two quarters of accelerated growth. Then it’s back to the muddle.

2015-05-19 00:00:00 The U.K. Elections by Bill O’Grady of Confluence Investment Management

The recent UK elections shocked pollsters, who had predicted a hung parliament. Instead, the Conservatives (Tories) won an outright majority in the legislature, allowing the party, led by David Cameron, to form a government without a coalition. We begin by recapping the election results and discuss the campaigns and what they indicate for future U.K. policy. An examination of the impact of the election follows, beginning with an analysis of the geopolitics of Britain and ending with how the election affects the country’s geopolitical situation.

2015-05-18 00:00:00 WSJ Economists' May Forecasts for 10-Year Yields and the Fed Funds Rate by Doug Short (Article)

On Wednesday the Fed will release the FOMC Minutes for its April meeting. Meanwhile let's take a quick look at a couple of items in the May Wall Street Journal survey of economists, starting with where the Federal Reserve is headed with the Fed Funds Rate, which is currently hovering around 0.12 percent.

2015-05-18 00:00:00 Two Blows to Broadband: 4 Implications of Tougher Regulation by Janet Sung of Loomis Sayles

The broadband industry is reeling from the one-two punch delivered by recent rulings that signal the advent of a much harsher regulatory landscape for internet service providers (ISPs).

2015-05-18 00:00:00 The "New Era" is an Old Story by John Hussman of Hussman Funds

It’s not monetary easing, but the attitude of investors toward risk that distinguishes an overvalued market that continues higher from an overvalued market that is vulnerable to vertical losses. That window of vulnerability has been open for several months now, and the immediacy of our downside concerns would ease (despite obscene valuations) only if market internals and credit spreads were to shift back toward evidence of investor risk-seeking. Meanwhile, there’s no evidence to suggest that historically reliable valuation measures have somehow become irrelevant.

2015-05-18 00:00:00 Investor Sentiment Around the World by Mark Mobius of Franklin Templeton Investments

We certainly don’t want to jump to any conclusions about potential market performance based on investor sentiment (or any one indicator for that matter), but it reminds me of the late Sir John Templeton’s famous words: ‘Bull markets are born on pessimism, grow on skepticism and die on euphoria.

2015-05-18 00:00:00 Chicago Faces Critical—but Not Insurmountable—Financial Problems by Joseph Rosenblum of AllianceBernstein

Chicago’s decades of poor financial decision making will come to a head as Mayor Rahm Emanuel starts his second term today. His battle to enact pension reform and stabilize finances will shape his legacy and Chicago’s future. But it’s hard to envision a successful solution given the extent of the problem.

2015-05-18 00:00:00 Security Selection and Liquidity Management Are Key in the Steadily Growing Credit Market by Jelle Brons, David Linton of PIMCO

Over the past several years, two trends have reshaped the market for U.S. investment grade (IG) corporate bonds: a significant increase in the size of the market (both in number of issuers and issues and in aggregate debt outstanding) and a contraction in dealer balance sheets.

2015-05-18 00:00:00 ProVise Bullets by Ray Ferrara of ProVise Management Group

As the snow finally began melting in the North, the negative impact on the economy also began to melt away. While the weak jobs number for March was revised downward from 126,000 to only 85,000, the April jobs number bounced back with 223,000 non-farm jobs. Private jobs, primarily represented by services, healthcare, and construction, produced all but 10,000 jobs which were created by government. The headline unemployment number dropped to 5.4%, the lowest since the beginning of the financial crisis in 2008.

2015-05-18 00:00:00 Weighing the Week Ahead: Will the Interest Rate Spike Threaten Stock Prices? by Jeff Miller of New Arc Investments

This week’s economic calendar includes the most important housing data, but the market context will prove irresistible to the pundits. Stocks continue at the top of the trading range, and even broke through for a few minutes. Even more interesting is the bond market. Interest rates decisively broke their trading range and also showed a lot of volatility.

2015-05-18 00:00:00 Inspiring Economic Growth by Robert Shiller of Project Syndicate

In his First Inaugural Address, during the depths of the Great Depression, US President Franklin Delano Roosevelt famously told Americans that, “The only thing we have to fear is fear itself.” The same could be said today, seven years after the 2008 global financial crisis, about the world economy’s remaining weak spots.

2015-05-18 00:00:00 Constructively Dissatisfied by Keith McCullough of Hedgeye Risk Management

Say I was constructively dissatisfied with how last week went for Global Macro markets. Constructive because I think we made the right research pivot on Dollar Down, Commodities Up. Dissatisfied because devaluing the Dollar isn’t the answer for America’s stagnating economy.

2015-05-18 00:00:00 Warning: Don’t Let Market Hype Cause You to Miss This Total Return Opportunity by Chuck Carnevale of F.A.S.T. Graphs

Since the Great Recession of 2008 came to an end, the stock market, as measured by the S&P 500, is almost midway through the 7th year of a strong bull run. This marks today’s bull market as the third longest in US history. Considering how traumatizing the Great Recession and the accompanying stock market collapse was for most investors, this should be good and comforting news. But unfortunately, the length and level of our current bull market seems to be conjuring up more worry and angst than comfort.

2015-05-18 00:00:00 Energy, metals, agriculture, timber, water. by Shundrawn Thomas, Northern Trust Asset Management, Head of Funds and Managed Accounts (Article)

Why a balanced approach to natural resources resonates with financial advisors.

2015-05-17 00:00:00 US Equity and Economic Review For the Week of May 11-15; A Really Unimpressive New High, Edition by Hale Stewart of Hale Stewart

Last week’s economic news continued to disappoint. Retail sales were weak, industrial production was flat and capacity utilization decreased. As we near the end of the earnings season, the S&P 500 revenue numbers show a decline. While the SPYs made a new high, the mid-caps, small caps and transports failed to confirm, indicating the large cap move higher stands little chance of meaningful follow-through.

2015-05-16 00:00:00 Secular Versus Cyclical: Notes from SIC 2015 by John Mauldin of Mauldin Economics

The consensus I’m hearing and reading from the 500+ attendees at the recent Strategic Investment Conference is that this was the best ever. It was certainly intense, with more divergent views presented this year than at previous conferences. Plus, the range of topics was rather dramatic. This year I was able to listen to all but one of the presentations, and I want to share with you my notes and takeaway thoughts.

2015-05-16 00:00:00 Wall Street Underestimates the Great American Earnings Machine by Frank Holmes of U.S. Global Investors

With a little over 90 percent of S&P 500 companies having reported, it looks as if the index has risen a modest 2 percent for the first quarter. That might not seem significant, but as LP Financial Services Chief Investment Officer Burt White points out in a recent Barron’s piece, “given the steep uphill climb that corporate America faced due to the twin drags of the oil downturn and strong U.S. dollar, this is actually a good result.”

2015-05-16 00:00:00 Weekly Market Summary by Urban Carmel of The Fat Pitch

US indices are in an uptrend. But what they have lacked is the ability to sustain upward momentum for more than a week or two. With SPY at a new ATH, another test of strength has again arrived. There's room for price to move higher, but we suspect that any gains are likely to be short lived.

2015-05-16 00:00:00 Strange Machinations by Scott Minerd of Guggenheim Partners

What to make of markets that are no longer on speaking terms with their fundamentals.

2015-05-16 00:00:00 Why Some Investors are Tilting Toward TIPS by Matthew Tucker of BlackRock Investment Management

With Treasury yields hovering near record lows, and many believing they are set to rise, Matt Tucker explains why Treasury Inflation Protected Securities (TIPS) may be worth another look.

2015-05-16 00:00:00 Align the Design: Considering and Evaluating Target-Date Glide Paths by Stacy Schaus and Ying Gao of PIMCO

Few responsibilities are as important to defined contribution (DC) plan sponsors as selecting a default glide path that best maximizes a participant’s odds of retiring on time and with sufficient lifetime income. The goal, put simply, is to maximize asset returns while minimizing volatility relative to the retirement liability – precisely what Objective-Aligned Glide Paths aim to achieve.

2015-05-16 00:00:00 Explaining the Rise in Long-Term Interest Rates by Carl Tannenbaum of Northern Trust

Explaining the Rise in Long-Term Interest Rates; Consumers Should Overcome Higher Gas Prices; OPEC and the U.S. Face Off in the Oil Markets

2015-05-15 00:00:00 “Wrestling with Something Else”: Why this Gold Bear Market Is Different by Frank Holmes of U.S. Global Investors

Earlier this week, I had the pleasure to appear on Jim Puplava’s Financial Sense Newshour radio program and discuss the state of the gold market. Along with my peers John Doody of the Gold Stock Analyst and Ross Hansen of Northwest Territorial Mint, I shared my thoughts on how we arrived in the current bear market, what factors might help us get out of it and the role real interest rates play in prices.

2015-05-15 00:00:00 Can Crude and Copper Keep Rallying with China Slowing? by Team of GaveKal Capital

Yesterday saw the monthly slue of Chinese economic stats and the key feature among them was the continued broad-based weakness. The weakness in some of these statistics has been so pronounced (some things like IP and retail sales are at levels near or below those seen at the depths of the financial crisis) that it has us wondering if the price of oil and copper can continue to rally in the face of an increasingly slower China?

2015-05-15 00:00:00 UK Election Result Fuels Vote for Smaller Stocks by Alan Connery, Liliana Castillo Dearth of AllianceBernstein

Britain’s Conservative party’s election win has buoyed smaller companies. The vote of confidence offers an opportunity to take a closer look at UK small- and mid-cap (SMID) stocks, which are highly profitable versus European peers.

2015-05-15 00:00:00 Monetary Policy at Warp Speed by Harley Bassman of PIMCO

An imaginative twist on theoretical physics forms the premise of the science fiction series “Star Trek”: An engine called a warp drive enabled the Starship Enterprise to travel faster than the speed of light, going beyond known space to uncharted, exciting new worlds. The confounding detail was managing the sheer power inherent in the warp drive, including its potential to behave in unexpected ways.

2015-05-15 00:00:00 The Big Chill: What’s Wrong with the U.S. Consumer? by Russ Koesterich of BlackRock

Most market watchers expect the US economy to bounce back in the second quarter. However, the consumer isn’t playing to script. Russ explains.

2015-05-15 00:00:00 Taper Tantrum Redux by Anthony Valeri of LPL Financial

After a brief reprieve at the end of last week (May 4–8, 2015), the global bond sell-off resumed Monday, May 11, 2015, with 10- and 30-year Treasury yields rising to year-to-date highs of 2.28% and 3.04%, respectively. Treasury yields have now broken out of their recent ranges and have done so quickly.

2015-05-15 00:00:00 Close to Retirement and Under-Saved, What Should You Do? by Roger Nusbaum of AdvisorShares

A blog post from the Wall Street Journal back in February noted that “the typical working household with a 401(k) approaching retirement had only $111,000 in a 401(k) and IRA.” There are plenty of articles floating around in the last couple of years lamenting how low retirement balances are. If $111,000 is right, that would be one of the higher averages published (obviously it is all in how the data is collected and who is surveyed but that is not the point of this post).

2015-05-15 00:00:00 Diagnosing China's Debt Disease by Andy Rothman of Matthews Asia

China suffers from a serious case of “debt disease,” but the treatment and side effects may not be as severe as some expect, and dramatic credit tightening is very unlikely. Debt is concentrated among state-owned firms, while the private firms that generate most of China’s new jobs and investment have already deleveraged. The biggest risk is the high level of debt among real estate developers.

2015-05-15 00:00:00 The Most Wonderful Time of the Year (for Japanese Equities) by Christopher Gannatti of WisdomTree

March 31 marks the end of Japan’s fiscal year, making it a very important point from which to gauge how Japanese stocks are behaving and, ultimately, whether Abenomics is having any real impact. Based on what we’re seeing so far, we remain extremely excited for the prospects of Japanese equities.

2015-05-15 00:00:00 Beyond the Active vs. Passive Debate by Robert Cron of Bronfman E.L. Rothschild

The active versus passive debate is a hot topic in the financial media. That’s no surprise given recent performance and a dramatic shift in investors’ preferences. For several years, the average passively managed fund has outperformed the average actively managed fund.

2015-05-15 00:00:00 The Discovery of Ignorance by Francois Sicart of Tocqueville Asset Management

Eleanor Roosevelt reportedly said that small minds discuss people, average minds discuss events, and great minds discuss ideas. If she was right, my own mind took a huge leap toward greatness in the last few weeks.

2015-05-15 00:00:00 Downside Protection: The Changing Methods and Mindset of Investment Research by David Robertson of Arete Asset Management

It is becoming increasingly important to be able to share information and “connect the dots” instead of developing narrowly focused proprietary expertise. It should not be forgotten that one of the primary goals of research should be to protect against the downside.

2015-05-14 00:00:00 No Looking Back in Stock-Picking by William Smead of Smead Capital Management

Wayne Gretzky is considered the greatest hockey player of all time. When asked why he was such a great player, he replied, “I skate to where the puck is going to be.” We at Smead Capital believe that investors are stuck where the puck is now. In fact, we theorize that most investors get stuck where the puck was before the last line change. We call this “rear-view mirror” investing. It is our opinion that understanding where we’ve been, where we are now and where we are going is important in common stock selection in 2015.

2015-05-14 00:00:00 The Momentum Mob by Keith McCullough of Hedgeye Risk Management

In markets, the momentum mob constantly cares about one thing – #charts. Lots and lots and lots of charts. The linear moving average ones are the simplest to scare you with.

2015-05-14 00:00:00 Problems The Media Ignored In The April Jobs Report by Gary D. Halbert of Halbert Wealth Management

Today we’ll start with a look at last Friday’s unemployment report for April. If you read the mainstream media accounts, it was fantastic – the official unemployment rate fell to 5.4%, the lowest level since 2007. But as usual, if we dig into the internals of the report, we find that the results were much less than desired.

2015-05-14 00:00:00 OMG: Putting Jump In Interest Rates Into Perspective by Lance Roberts of Streettalk Live

During my daily radio broadcast yesterday, I received a rather "panicked" call regarding the "dramatic plunge" in his bond funds due to the recent jump in interest rates. Of course, he is not alone. Over the last few weeks the media has done its normal headline-grabbing spin by dragging out every bond "bear" they can find to discuss why this time, unlike like the last 30 times, is definitely the end of the "great bond bull market."

2015-05-14 00:00:00 M&A Activity in Technology Heats Up by J.P. Scandalios of Franklin Templeton Investments

Many IT firms are flush with cash, and, as companies are maturing in the space, they are expanding the ways they return value to shareholders. Buybacks and the initiation or growth of dividends have been common, but increasingly M&A activity is seen as a strong option for technology firms looking to increase their value.

2015-05-14 00:00:00 Wake Me Up When September Ends by Andrew Friedman of The Washington Update

In my legislative update early this year, I noted that ongoing acrimony between Congressional Republicans and the Obama White House likely precludes agreement on any broad new legislative initiatives this year. Instead, Congress and the White House are likely to reach agreement only in the face of “forcing events” – deadlines that compel action to ward off a draconian result.

2015-05-14 00:00:00 Bearish on the U.S. Markets, Yusko Looks to Japan and Russia for Growth by Jeremy Schwartz of WisdomTree

This week Professor Siegel and Jeremy Schwartz chatted with Mark Yusko, Chief Investment Officer of Morgan Creek Capital, about his thoughts concerning extended U.S. valuations and global markets that may offer abundant potential beyond that of the United States.

2015-05-14 00:00:00 Developed Asia Pacific: Economy Trends Update April 2015 by Team of Thomas White International

Though Japanese exports exceeded imports in March 2015, weak domestic spending appears to have impacted the country’s nascent economic recovery. Wage growth needs to trickle down to workers employed in smaller Japanese firms, which would also push up inflation. Thankfully, the Bank of Japan has said it will hold its stimulus program in place until economic growth picks up pace.

2015-05-14 00:00:00 A Look at High Yield Bond and Equity Valuations by Tim Gramatovich, Heather Rupp of AdvisorShares

There has been talk in the media recently about high yield being overvalued at current levels. However, we feel that historical metrics indicate that we are nowhere near a point of overvaluation; rather, there is still value to be had in this market.

2015-05-14 00:00:00 What's Driving M&A in the Healthcare Space? by (Article)

Portfolio Manager Carl Brown believes that cash-rich corporate balance sheets and increased competitiveness in the healthcare universe will make smaller companies attractive targets for M&A activity.

2015-05-14 00:00:00 Risk Parity: Reducing Our Bond Exposure by Scott Wolle of Invesco Blog

Every month, the portfolio management team for the Invesco Balanced-Risk Allocation strategy examines the market’s signals for stocks, bonds and commodities, and makes tactical adjustments in an effort to enhance returns. In recent weeks, our tactical signals for government bonds have led us to substantially reduce our exposure and adopt an underweight position.

2015-05-13 00:00:00 The Next Generation by Bill O’Grady of Confluence Investment Management

Saudi King Salman recently announced a set of changes to his cabinet and the order of royal succession. We believe these changes are significant, perhaps the most critical since the first royal succession in 1953. In this report, we detail the changes announced by King Salman and provide a short history of the important succession plan that was established in 1964. With this background, we show how the king’s announcement represents the first change in the program and discuss how these changes could affect the future stability of the kingdom.

2015-05-13 00:00:00 The Happening by Jeffrey Saut of Raymond James

“The Happening” . . . except in this case I am not referring to the 1967 movie, whose title song was sung by the Supremes, but last Thursday’s “Friends of Fermentation” (FOF) gathering at Bobby Van’s across from the NYSE.

2015-05-13 00:00:00 Stocks Look Expensive…and Still Attractive by Ilya Figelman of AllianceBernstein

Developed-market equity valuations seem a bit expensive today—but we still think they’re worth an overweight in multi-asset strategies. A wider view shows that stocks remain attractive globally.

2015-05-13 00:00:00 US Equity Leadership (Still) Hasn't Changed by Team of GaveKal Capital

We mentioned two weeks ago how equity performance has flip-flopped in the second quarter and how asset prices are most likely just in a counter-trend rally. Since then, others have picked up on this theme with a lot of folks calling for higher bond yields in particular (we aren't so sure). If equity markets are in the process of a trend change, one would expect leadership to change as well. As we will show in the charts below, this doesn't look to be happening from a relative performance perspective in the US. All data is in USD, on an equal-weighted basis and as of 5/8/2015 close.

2015-05-13 00:00:00 When is “in” not the opposite of “out”? by Jerry Wagner of Flexible Plan Investments

When you ask someone what is the opposite of “in,” they automatically say “out.” But when you ask them “What’s the opposite of income?”, some might immediately start to say “outcome”, but that’s never their final guess.

2015-05-13 00:00:00 Earnings Recap: Good Enough? by Burt White of LPL Financial

The first quarter 2015 earnings season is virtually over and the results relative to lowered expectations were quite good. Investors were braced for an earnings decline and the possible start of an “earnings recession,” but it looks like they will end up with a better than feared, year-over-year earnings growth rate of about 2%, according to Thomson Reuters data. This pace is impressive considering the significant drags from the oil downturn and strong U.S. dollar. Here we recap the first quarter 2015 earnings season and share our earnings outlook for the rest of 2015.

2015-05-13 00:00:00 CEF Yield by (Article)

If you’re looking for yield, closed-end funds may interest you, says John Cole Scott of CEF Advisors. But remember, CEF distributions may change.

2015-05-13 00:00:00 ‘Good Times’ Challenge by (Article)

Investing during good times, when markets are doing relatively well, may present a challenge to both the CEF industry and investors, says Alex Reiss of Stifel.

2015-05-13 00:00:00 Beyond Beta: How Quantitative Portfolios (QPs) Elevate the Client Experience by (Article)

Each client’s investment challenge is different from the next and “one-size-fits-all” passive investments can often fall short in addressing important needs. Watch this animated video to learn how our Factor-Enhanced and Market Series QPs can help take investor portfolios beyond beta and truly enhance the client experience.

2015-05-13 00:00:00 Energy, Interest Rates, and Risk Management Today by (Article)

Chuck Royce discusses some of the events that helped shape the first quarter and the prospects for risk management in a more normalized environment.

2015-05-13 00:00:00 See No Evil: What We Chose to Ignore in the April Jobs Report by Peter Schiff of Euro Pacific Capital

We live in an age where bad economic news is not only unwelcome, but it is routinely overlooked or excused. On the other hand, good news is spotted and trumpeted even when it doesn't exist. An ideal illustration of this dangerous tendency towards collective selectivity came last week when the markets and the media somehow turned an awful employment report into an ideal data set that confirmed all optimism and contained nothing but good news for investors. In truth, it was anything but.

2015-05-12 00:00:00 The Best Approach to Adjustable Retirement Withdrawals by Joe Tomlinson (Article)

A great deal of recent research has focused on strategies that adjust withdrawals in retirement depending on investment experience. But such strategies disrupt retirement plans by causing withdrawals to vary a lot from year to year. I'll examine the prominent approaches for determining what will work best for clients.

2015-05-12 00:00:00 Louis-Vincent Gave: The World's Most Crowded Trade by Robert Huebscher (Article)

Investors are paid to adapt, not to forecast, according to Louis-Vincent Gave, and three changes are occurring globally that all portfolios must accommodate. One of them is a position that is missing from virtually every investor's allocation.

2015-05-12 00:00:00 Michael Pettis: The Limit to China's Growth by Robert Huebscher (Article)

Faced with an incredibly difficult rebalancing challenge - one which very few developed countries have overcome - Michael Pettis says that the best China can achieve is 3% to 4% GDP growth.

2015-05-12 00:00:00 Jim Bianco's Unconventional Ideas by Robert Huebscher (Article)

According to Berkshire Hathaway's Charlie Munger, when it comes to investing, everything important is counterintuitive; everything obvious is wrong. In that spirit, Jim Bianco offered a series of unconventional ideas on the stock market, Fed policy and oil prices.

2015-05-12 00:00:00 A Small Gift with a Lasting Impact by Dan Richards (Article)

Some advisors have found a way to make their gifts and entertainment stand out - and offer a valuable lesson on how you will get a bigger return from your activities - as well as recognize and thank clients. There are four keys to making your activity stand out.

2015-05-12 00:00:00 How to Make Your Message Persuasive by Daniel Solin (Article)

We all want to make our message persuasive, but few advisors pay attention to the peer-reviewed studies identifying the most efficient methods for doing so.

2015-05-12 00:00:00 Making Meetings More Productive by Beverly Flaxington (Article)

I can't get any work done. My firm is obsessed with meetings, organizing them for every little thing. How do I stop the madness without looking like I'm not a team player?

2015-05-12 00:00:00 Five Reasons to Adopt "Legacy Planning" over Estate Planning by Mark Davis (Article)

Legacy planning - providing advice to intergenerational clients that extends beyond wealth transfer - is a critical strategy for retaining client relationships and assets for the long-term.

2015-05-12 00:00:00 Weathering Market Risk With Dividend Stocks by Sponsored Content by Invesco (Article)

Retirement planning is like a road trip: You need a well-thought-out plan to reach your destination. Prudent travelers should be prepared for occasional bursts of volatility. Dividend-paying stocks can help manage market risk by providing relatively conservative exposure to the equity market.

2015-05-12 00:00:00 The Future of Investing ESG Portfolios: Changing Beliefs, Perceptions and Goals by Sponsored Content by ClearBridge Investments (Article)

Investing consistent with environmental, social and governance (ESG) principles can no longer be dismissed as a short-term fad. Assets under management are growing steadily, accompanied by a rise in the number and type of investment options across asset classes. Clearbridge's research explores how institutions are investing with impact today.

2015-05-12 00:00:00 Henderson Unconstrained Bond Fund (HUNAX) update by (Article)

James McAlevey, Head of Interest Rates and Kevin Adams, Director of Fixed Income, provide a review of the Henderson Unconstrained Bond Fund’s performance in April and discuss the drivers of the recent increase in bond market volatility. Performance in April was reasonably good particularly in the context of global bond markets selling off quite substantially.

2015-05-12 00:00:00 Q1 Letter by Team of Grey Owl Capital Management

Grey Owl’s strategies all performed well in the first quarter. The good performance came despite US GDP growth of just 0.2%, continually lowered earnings expectations, and volatile equity and bond markets. Below we discuss the current environment including the now absolute fixation by investors on every Fed comment, our continued focus on an all-weather approach, and our best and worst performing securities during the quarter.

2015-05-12 00:00:00 Has Sales Growth Peaked for the Cycle? by Team of GaveKal Capital

Sales growth estimates for companies around the world began sliding towards the middle of 2014 as the price of oil began its months-long setback. In the first chart below we show the average and median company's next 12 month sales growth estimate for the MSCI World Index which shows that the level of expected sales growth took a significant step down into the first quarter of 2015.

2015-05-12 00:00:00 The Dangerfield Recovery Or A Skousen Reality by Lance Roberts of Streettalk Live

During my morning reading I ran across this article by my friend Cullen Roche, via Pragmatic Capitalist, entitled "The Economic Recovery That Can't Get Any Respect," or more commonly known as the "Dangerfield Recovery."

2015-05-12 00:00:00 Dog Days of the U.S. Expansion by Scott Minerd of Guggenheim Partners

The Kentucky Derby marks the beginning of summer, but ultimately investors must prepare for the coming winter.

2015-05-12 00:00:00 A Wild Ride for Global Bond Yields by Seth Masters of AllianceBernstein

Bond yields in key markets around the world have been on something of a roller-coaster ride, moving up quickly in recent months. Ten-year Treasury rates closed at 2.28% on May 11, up from 1.65% at the end of January.

2015-05-12 00:00:00 In the Market’s Sweet Spot by Scott Brown of Raymond James

Recent economic data reports have reflected a slowdown in growth, but they are not disastrous. The economy continues to improve, but not so much that the Fed will rush to take away the punch bowl. That’s good news for the financial markets.

2015-05-12 00:00:00 What's next for Gold? by Axel Merk of Merk Investments

Will gold zoom higher with Greece on the brink of default? Or will it crash as the Fed pursues an “exit?” Why has gold not rallied with the recent retreat of the dollar? To understand where gold may be heading, keep in mind that this shiny metal isn’t changing; it’s the world around it that is. We contemplate why investors may want to hold gold as part of their portfolio.

2015-05-12 00:00:00 Time to look at South Korea by Richard Bernstein of Richard Bernstein Advisors

Our global investments continue to focus on the secondary effects of the deflating global credit bubble. The bubble’s deflation has left the world awash in capacity, and we expect countries to fight for market share as a result of that overcapacity.

2015-05-12 00:00:00 As Volatility Rises, Momentum Loses by Russ Koesterich of BlackRock

With volatility rising, BlackRock Global Chief Investment Strategist Russ Koesterich discusses implications for the markets, especially momentum stocks.

2015-05-12 00:00:00 Korea's Booming Health Care Sector by Soo Chang Lee of Matthews Asia

Korea’s health care companies have long faced challenges competing with global players that have secured patents and intellectual property for products. But is Korean pharma finally prepared to move beyond generics?

2015-05-12 00:00:00 High Yield: Handling Headline Risk by Milton Ezrati of Lord Abbett

Market movements caused by the sharp drop—and subsequent recovery—in oil prices provide insight on successfully navigating the high-yield market.

2015-05-12 00:00:00 Are We Headed for a Hangover? by Gibson Smith of Janus Capital Group

It’s late, and the punch bowl is half full. With central banks around the globe still in accommodative mode, the threat that the Federal Reserve (Fed) will pull away the punch bowl sets up the markets for some real disruption. Until then, let the party continue.

2015-05-12 00:00:00 British Election: Repercussions for America by John Browne of Euro Pacific Capital

The British General Election, on May 7th, was an epic in two respects. First, in spite of polls forecasting a hung parliament, David Cameron’s Conservative Party was given unexpectedly large support, winning 331 seats, or 51 % for an overall majority of four, and showing once again the failure of left wing parties to make traction in Europe.

2015-05-11 00:00:00 Recognizing the Risks to Financial Stability by John Hussman of Hussman Funds

Our hope is that Chair Yellen’s growing recognition of speculative risks will continue, and for the sake of the U.S. economy, that the rather baseless hope of manipulating a “Phillips Curve” or a “wealth effect” will fade. If one believes in these things, it is tempting to think that more monetary easing could be “good” for the economy. If the FOMC recognizes how weak those empirical relationships actually are, and how extreme the financial distortions have become, we might still avoid another financial crisis.

2015-05-11 00:00:00 Economic & Capital Market Summary – First Quarter 2015 by Gregory Hahn of Winthrop Capital Management

Our belief is that a market is simply a clearinghouse for the price of risk and the quantitative easing programs of the central banks of developed countries are distorting the price of risk in our capital markets. As a result, valuations in bonds, stocks, real estate and other assets are distorted.

2015-05-11 00:00:00 Strategic Allocaiton to High Yield Corporate Bonds – Why Now? by Matthew Kennedy of Rainier Investment Management

The demand for higher yielding fixed income investments has never been greater. In the current environment of low yields, from the virtually non-existent rate offered on savings accounts and CDs to the declining, and in some cases negative, yields on global government debt securities, investors are searching for attractive income¬ generating alternatives.

2015-05-11 00:00:00 Car Nut by Brian Andrew of Cleary Gull

I love cars, both new and old. I like to drive them, talk about them, watch them race and just about anything involving them. I also think cars can tell us a lot about people, investors and the economy. Last week, the monthly auto sales data were released and there were some interesting trends that tell us something about secular demographic trends, the impact of falling gas prices and how workers are feeling about their prospects.

2015-05-11 00:00:00 Taming Longevity Risk by Patrick Drum of Saturna Capital

"In spite of the cost of living, it's still popular." - Kathleen Norris. These words offered by Kathleen Norris decades ago carry more weight than ever before, particularly within the realm of financial planning and saving for retirement.

2015-05-11 00:00:00 Utilities Sector at an Inflection Point by John Kohli, Blair Schmicker of Franklin Templeton Investments

While utilities stocks will likely be impacted by upcoming Fed maneuvers and an eventual rising interest-rate environment, we think lower reliance on dividends and a decent growth rate in dividends received by investors might actually help counter the implied effect of higher interest rates.

2015-05-11 00:00:00 On My Radar: Life is Great! by Steve Blumenthal of CMG Capital Management Group

The primary need of investors is shifting and the risk dynamics has changed. Gone are those wonderful defined benefit plans. This is the first generation of retirees retiring with control of their financial assets. That’s good news for your advisory business, yet, with zero bond rates and 10-year forward returns for equities in the 2% to 4% range, the challenges loom large.

2015-05-11 00:00:00 Attention Contrarians – Time to Look at Emerging Markets by Christopher Gannatti of WisdomTree

Often when it becomes difficult to even consider discussing—much less investing in—particular markets, it might be time to take another look. History is full of examples of investors with strong stomachs making out quite well by buying some of the most unloved markets, sectors or companies in the world.

2015-05-11 00:00:00 Corporate Earnings and Inflation by Clyde Kendzierski of Financial Solutions Group

A few months ago our 2015 forecast emphasized several points we began making late last year. Taken together, those points differed dramatically from the prevailing wisdom of the time. As we begin May, they are falling into place.

2015-05-11 00:00:00 Western Politics’ Locust Years by Mohamed El-Erian of Project Syndicate

Many mainstream political parties in the West are so busy playing defense that they are forgoing the strategic thinking needed to re-energize growth models, anchor financial stability, and ensure that technological innovation enables broad-based prosperity. As a result, Western economies may be undermining their future potential.

2015-05-11 00:00:00 Roadblocks to Equity Gains May Start to Fade by Robert Doll of Nuveen Asset Management

Investors had a lot to react to last week, with the biggest story being a continued rise in global bond yields. The Conservative Party secured an unexpectedly decisive victory in the U.K. elections and Fed Chair Janet Yellen commented about higher equity valuations.

2015-05-11 00:00:00 Tracking the Market with Social Media by Blair Jensen of Trade Followers

I’ve posted warnings of a short term top for the S&P 500 Index (SPX) over the past couple of weeks and since that time the market has been choppy. I’m now seeing evidence of sentiment from the Twitter stream that indicates SPX is due for a move higher. The evidence suggests that SPX should break out of its recent range. The first clue comes from 7 day momentum which has moved down into oversold territory.

2015-05-11 00:00:00 Bubble Trouble in Nasdaq’s Nursery by Dan Roarty of AllianceBernstein

Are technology stocks in a bubble? Opinions differ. But the sector’s startup baby boom and the rich valuations being showered on so many fledgling firms warrant a more discriminating approach for investing in disruptive innovation.

2015-05-11 00:00:00 How to Implement a Factor-based Smart Beta Investing Strategy by Sara Shores of BlackRock

Smart beta expert Sara Shores explains factor investing and shares several ideas for how to potentially implement this strategy into your own portfolio.

2015-05-10 00:00:00 US Equity and Economic Review For the Week of May 4-8; Mid-Caps Break Trend, Edition by Hale Stewart of Hale Stewart

Last week’s economic releases provided much needed bullish news with strong headline numbers from the ISM Services Index and the monthly employment report. But the 1.9% Q/Q decline in productivity was concerning. On the earnings front, with a little over 90% of the S&P 500 companies reporting, total revenues are off 4.1% Y/Y. Adding to the negative backdrop is that future earnings projections continue to move lower. This weak performance on the company level sent the markets lower, with the small caps consolidating recent declines while mid-caps joined in recent trend-breaking.

2015-05-08 00:00:00 Amazon and Apple: Two Approaches To Capital Investment by Team of GaveKal Capital

With Apple's (ticker: AAPL) announcement that are selling more debt in order to buy back more shares and pay out dividends, a client posed an interesting question to us: Do you think Amazon (ticker: AMZN) will announce something similar soon? Our short answer is most likely no since Amazon tends to reinvest earnings, especially in intangible investments, much more aggressively than Apple does. Let's take a quick look at how Amazon and Apple's investment profiles and payout strategies differ (all data refers to Gavekal's intangible-adjusted financial statements).

2015-05-08 00:00:00 In the Know: Seven Myths About Municipal Bonds by Rafael Costas, Sheila Amoroso of Franklin Templeton Investments

Municipal bonds are used to fund the public works projects that affect all of us every day. For many everyday investors (not just the wealthy) seeking to generate income in retirement, we think municipal bonds are worth considering.

2015-05-08 00:00:00 Follow the Smart Money: How the Pros Are Trading Right Now by Frank Holmes of U.S. Global Investors

No matter what profession you’re in, no matter what sport or hobby is important to you, chances are good you keep track of what the top professionals are up to. More often than not, they’re the smartest ones in the room. They’re the innovators, the thought leaders, and it pays to keep up with their decisions, behavior and opinions.

2015-05-08 00:00:00 Taxable Bonds in a Taxable Account? by Daryl Clements of AllianceBernstein

It sounds unorthodox. But for investors facing taxes, it makes sense to consider opportunities beyond the municipal bond realm. Because it’s all about what you have left after taxes.

2015-05-08 00:00:00 The Shocking Truth About Share Buybacks by Chuck Carnevale of F.A.S.T. Graphs

The value and benefits, or lack thereof, of share buybacks to the future fortunes of a company and their shareholders is one of the most hotly debated subjects on popular financial blogs such as Seeking Alpha. Unfortunately, at least based on my own personal experience, most of the arguments are predicated on opinions and beliefs in lieu of the facts.

2015-05-08 00:00:00 Inequality, Immigration, and Hypocrisy by Kenneth Rogoff of Project Syndicate

Europe’s migration crisis exposes a fundamental flaw, if not towering hypocrisy, in the ongoing debate about economic inequality. Wouldn’t a true progressive support equal opportunity for all people on the planet, rather than just for those of us lucky enough to have been born and raised in rich countries?

2015-05-08 00:00:00 MLPs: Providing Growth and Income Potential Despite Low Oil Prices by Joe Rodriguez, Darin Turner, Walt Stabell III of Invesco Blog

With oil prices down around approximately 50% since June 2014, investors are increasingly wary of the entire energy sector. Even given this environment, master limited partnerships (MLPs) represent an energy investment that we believe may weather short-term volatility in energy prices, benefit from the US’s long-term infrastructure needs, and provide attractive income potential for investors.

2015-05-08 00:00:00 Where Dividend Investors are Seeking Income by Russ Koesterich of BlackRock

Guest contributor Tony DeSpirito explains how investing in dividend-paying stocks isn’t what it used to be – and how to make dividend investing work in your portfolio.

2015-05-08 00:00:00 CEFs for Retirees by (Article)

Investors in or near retirement may find that CEFs offer compelling potential income, says Anne Kritzmire of Nuveen Investments.

2015-05-08 00:00:00 Made In Europe by Anthony Valeri of LPL Financial

A weak finish to the month of April 2015 was “made in Europe” as expectations of better global growth weighed on bonds. On Monday, May 4, 2015, the 10-year German government bond yield closed at 0.45%, more than quadrupling over the past two weeks. European strength combined with a dovish Federal Reserve (Fed) meeting outcome continued to arrest U.S. dollar strength, a primary driver of the steady decline in inflation and investors’ inflation expectations from mid-2014 through the first quarter of 2015.

2015-05-08 00:00:00 Global Economic Overview and Equity Commentaries: March 2015 by Team of Thomas White International

The global economy is facing subdued growth in the short term, as adverse weather and a stronger currency have slowed the pace of U.S. expansion. Unusually severe winter weather on the U.S. East coast restricted business and consumer activity during the first three months of the year.

2015-05-08 00:00:00 Watching and Waiting by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

Patience can be tough, especially in investing, but that is what is needed at the present time. While a sharp upward move in equities seems unlikely, and the risk of pullbacks is elevated; a grind higher is not something most investors should miss out on. Economic data and the Fed will continue to be in the spotlight, and we expect improvement that will lead to both a Fed rate hike and increased equity volatility—so be prepared. Across the pond, political uncertainty exists, but money supply should be the main focus, which could bode well for the possibility of future European equity gain

2015-05-08 00:00:00 Americans Take 3-Trillion-Mile Road Trip, Dollar Corrects and Commodities Rebound by Frank Holmes of U.S. Global Investors

The busy summer travel season is at our doorstep, starting this Mother’s Day weekend, and with that comes stronger fuel demand.

2015-05-08 00:00:00 Automation Can Inspire, But Also Intimidate by Carl Tannenbaum of Northern Trust

• Automation Can Inspire, But Also Intimidate • The United States Gets Back to Work • Disability Is Not a Refuge for the Unemployed

2015-05-08 00:00:00 The U.K. Election Surprises Everyone by Carl Tannenbaum of Northern Trust

Will the United Kingdom remain united? And will it choose to continue its economic alliance with the rest of the continent? These are key questions not just for Britain, but for the rest of the world. Whatever happens next, this election will certainly prove to be as important as it was billed to be, but perhaps not for the reasons originally thought.

2015-05-08 00:00:00 Threats To Worry About, And Those To Ignore, In This Equity Market by Urban Carmel of The Fat Pitch

Understanding where headwinds lie is not academic. If macro or financials were the main headwinds, we would expect this bull market to be near an end. That it has more to do with sentiment and valuation implies that a reset in equity prices (lower) will likely set up the next leg higher in 2015 and 2016.

2015-05-07 00:00:00 For trading, not eating! by Jeffrey Saut of Raymond James

Trading sardines indeed, except I have seen a lot of folks attempting to trade this market over the past few months all to no avail. What has typically happened is that one day they are able to make some money, but the next day they give that profit back.

2015-05-07 00:00:00 What Rising Yields Mean for U.S. Stocks by Russ Koesterich of BlackRock

Last week’s bond selloff provided a foreshadowing of the U.S. stock segments likely to suffer as the eventual Federal Reserve (Fed) rate liftoff nears.

2015-05-07 00:00:00 Oil & Water: Their Possible Impact on State Fiscal Health by Charles Kishpaugh of Loomis Sayles

Two situations stand out as having the potential to disrupt the fiscal health of important states: the deepening drought in California and the impact of low oil prices on states where oil production revenue is vital.

2015-05-07 00:00:00 Be Vigilant - not Paranoid - about CyberSecurity by David Edwards of Heron Financial Group

Sony, JP Morgan Chase, Target, Home Depot attacked. Russian, Chinese, North Korean, stateless hackers blamed. Stories about identity theft, e-mail hacks, and elder abuse blanket the news. No wonder many of our clients fear it's just a matter of time before the cyber criminals attack them personally. Fortunately, with a reasonable amount of vigilance, you can avoid becoming a victim.

2015-05-07 00:00:00 Emerging Markets May Make a Good Draft Pick to Add to Portfolios by Burt White of LPL Financial

The evaluation process NFL football teams go through to prepare for the NFL draft, which took place this past weekend, is not unlike the investment decision-making process.

2015-05-07 00:00:00 Labor Productivity, Household Incomes and Corporate Profits: And the Winner Is? by Doug Short (Article)

Yesterday the Bureau of Labor Statistics released the preliminary data for Q1 Productivity and Costs. We learned that the headline metric, nonfarm business sector labor productivity, decreased at a 1.9 percent annual rate during the first quarter of 2015. Let's take a look at the BLS's complete data series for this index, which dates from 1947.

2015-05-07 00:00:00 Region Insights – Europe – Investment Opportunity in Europe is Compelling by Derrick Tzau of Rainier Funds

While Europe abounds in world-class companies, macro concerns in 2014 obscured compelling opportunities for price appreciation and earnings power that we believe will surprise to the upside in 2015. Investors have woken up to the opportunity in the first two months of 2015 and many European exchanges are off to a fast start. We think more gains are ahead, particularly in small- to mid-size companies in Europe.

2015-05-07 00:00:00 What's Next for the Dollar and Currencies? by Axel Merk of Merk Investments

In anticipation of higher U.S. rates and lower rates elsewhere, the greenback had enjoyed a dramatic rally. Has the tide turned, or is the dollar merely taking a breather? We believe there are threats and opportunities hidden underneath recent market action. Below is a closer look in an effort to allow investors to better understand the dynamics that might be unfolding.

2015-05-07 00:00:00 Is Your Investment Factor “Campbell Harvey Strong”? by Jeremy Schwartz of WisdomTree

This week Professor Siegel and Jeremy Schwartz chatted with Campbell Harvey, professor at Duke University, to speak about his presentation, which challenges the efficacy of many factor-based investment strategies.

2015-05-07 00:00:00 Recession Probability Models - May 2015 by Ted Kavadas of StratX, LLC

There are a variety of economic models that are supposed to predict the probabilities of recession.

2015-05-07 00:00:00 The End of Short-Termism is Long Overdue by Zachary Karabell of Envestnet

For the past forty years, Wall Street and corporate boards increasingly have focused on short-term profits. Quarterly earnings determine the fate of a company’s share price, and demonstrating a robust trajectory of short-term earnings growth is rewarded above all else. Signs suggest that this trajectory is shifting, and if it does, that will bolster a long-term approach to investing and managing money.

2015-05-07 00:00:00 NASCAR, Firefighting, and Investing by Roger Nusbaum of AdvisorShares

Over the weekend at the Geico 500 at the Talladega Superspeedway, the underside of the Number 3 car driven by Austin Dillon caught fire in spectacular fashion. Someone on Dillon’s pit crew advised him to keep driving to the point where one of the racetrack fire crews was positioned which resulted in an instantaneous response and faster suppression of the flames.

2015-05-06 00:00:00 Laddered Bond Portfolios: Built to Perform in Rising Rate Environments by Josh Yafa of Thornburg Investment Management

As the Federal Reserve prepares to embark on a path of interest rate policy normalization, fixed income investors are finally facing the beginning of a cycle they have feared for the better part of a decade. Yet with answers come more questions, and while investors can reasonably expect a series of Federal Funds rate increases (hereafter, “Fed Funds”), the pace, magnitude, and ripple effects on various segments of the broader fixed income market are open to interpretation.

2015-05-06 00:00:00 International Equities: Another Turn of the Wheel by David Ruff of Forward Investing

It’s a truism that markets move in cycles and that the ideal time to invest is right at or near the start of an upswing. Diversification is another key tenet of Investing 101. Yet inertia and the pull of the crowd often lead investors to concentrate assets in markets that may be nearing their peak while ignoring potentially more promising opportunities.

2015-05-06 00:00:00 Can Assad Survive? by Bill O’Grady of Confluence Investment Management

Rebels in Syria have been making steady gains against forces loyal to the Assad regime and these gains have recently accelerated. The recent rebel victories are raising questions about the Assad regime’s ability to survive. In this report, we recap the problems the Syrian government faces, including internal dissent and military losses. We discuss the growing evidence of a Turkey-Saudi axis that may be aiding the rebels to weaken or eliminate Assad and pressure Iran. From there, we examine the potential Iranian and American responses to the rebel gains and support from Riyadh and Ankara.

2015-05-06 00:00:00 Crystal Balls, Likely Outcomes and Portfolio Planning by Robert Holton of Cleary Gull

In presentations to fellow professionals, we often make self-deprecating comments similar to this – “And then later we’ll tell you exactly when the Fed will raise interest rates. We’ll just grab our crystal ball and take a look.” That simple joke, variations of which are repeated over and over among financial professionals, draws on fairly deep-seated anxiety about the predictability of financial markets.

2015-05-06 00:00:00 The Mistake Eveyone Is Making About Fed Rate Hikes by Lance Roberts of Streettalk Live

With the Federal Reserve now indicating that they are "really serious" about raising interest rates, there have come numerous articles and analysis discussing the impact on asset prices. The general thesis is based on averages of historical tendencies as discussed recently by David Rosenberg in his daily commentary.

2015-05-06 00:00:00 An Investigation Into Corporate Investments by Team of GaveKal Capital

Profitability and investment are inextricably linked through time. A company's investment decisions today will ultimately drive its profitability level tomorrow. The fruits of a company's investment decisions eventually show up in profitability metrics such as free cash flow margin, operating cash flow margin, and return on equity. Finally. a company's ability to improve these metrics, year-in and year-out, ultimately dictates how a company's stock will perform over the long run.

2015-05-06 00:00:00 The Embarrassment of Transparency by Peter Schiff of Euro Pacific Capital

Over the past decade or so, "transparency" has become one of the buzzwords that has guided the Federal Reserve's culture. The word was meant to convey the belief that central banking was best done for all to see in the full light of day, not in the murky back rooms of Washington and New York. The Fed seems to be on a mission to prove that its operations are benevolent, fair, predictable, and equitable.

2015-05-06 00:00:00 Buying Time: Why We Think M&A Is Here to Stay by Cindy Sweeting of Franklin Templeton Investments

In an environment of still-moderate global economic growth that may not promise great rewards for new investment or capital expenditure, the market appears more prepared to accept that well-thought-out M&A, financed by lower-cost capital and low interest rates, could be quickly accretive.

2015-05-06 00:00:00 GSE Reform? It’s Already Happening by Michael Canter of AllianceBernstein

Official reform of the government’s role in housing finance isn’t likely this year. But de facto reform, led by the private sector, is already under way. That’s good for investors, borrowers and the housing market as a whole.

2015-05-06 00:00:00 The Credit Analysis Process: From In-Depth Company Research to Selecting the Right Instrument by Andreas Berndt, Charles Watford of PIMCO

Credit can offer a broad range of investment opportunities. But in today’s low yield environment, an active and integrated investment approach is critical.

2015-05-05 00:00:00 David Rosenberg - Bullish on Stocks by Robert Huebscher (Article)

The consensus narrative is negative for the economy and U.S. equity markets. But according to David Rosenberg, that is wrong. A recession is three years away, he said, and even if the Fed raises rates, equities will perform strongly this year.

2015-05-05 00:00:00 Should Investors Unload Their Mortgage REITs? by Keith Jurow (Article)

Lured by irresistible double-digit yields in 2012 and early 2013, investors dived into mortgage REITs with abandon. Having discussed the serious risks of equity REITs in my previous article, now is a good time to examine whether mortgage REITs pose similar risks for the unwary.

2015-05-05 00:00:00 Will China's Shadow Banking System be its Ruin? by Michael Edesess (Article)

A great deal of concern has focused on China's shadow banking system, and whether that system is reliant on a real estate bubble that will ultimately collapse, bringing the economy down with it. The recent global financial crisis, in which the U.S., the U.K. and other world leaders tripped and fell, makes this scenario seem very possible.

2015-05-05 00:00:00 Ten Lessons from America's Top Marketer by Dan Richards (Article)

The world's largest consumer products company with global sales of $80 billion, Procter and Gamble has 26 brands with sales over $1 billion and names like Tide, Crest and many others. P&G's marketing success provides 10 important lessons for financial advisors.

2015-05-05 00:00:00 How Your Clothes Alter Your Conduct by Dan Solin (Article)

I have never met an advisor who truly understood the extensive data on first impressions. That's unfortunate because the failure to recognize the impact of a first impression means converting fewer prospects into clients.

2015-05-05 00:00:00 Improving Client Communication Skills by Beverly Flaxington (Article)

Clients describe a void to me; they will call to ask questions about an issue and might wait days to hear back. I know that my staff is working on finding an answer, and that's why they don't respond. But the clients don't know this, and it makes for a poor client experience. Any tips on improving the response time and communication?

2015-05-05 00:00:00 Make Your Website Work as Hard as You Do by Lauren Hong (Article)

Every three to five years. That's how often you should be refreshing and revamping your website based on how quickly technology and design develop. Not what you want to hear? Fear not: I promise the return is worth the investment on this one.

2015-05-05 00:00:00 Waiting on the Turn by Scott Brown of Raymond James

The economy slowed in the first quarter, reflecting a variety of restraints. Most of these should give way, leading to stronger growth in the second quarter. However, Federal Reserve officials and financial market participants will want to see proof.

2015-05-05 00:00:00 Who Is Afraid of the Inflation Ogre? by Liz Ann Sonders, Christian Menegatti of Charles Schwab

When many commentators and investors show a high conviction about something, it is perhaps a good time to explore how things could move in the opposite direction. After several trillions of quantitative easing (QE) from the major global central banks, and with trillions of QE likely ahead, the consensus appears spooked by the specter of global disinflation and deflation. The possibility of a higher inflation scenario seems to have fallen completely off the radar.

2015-05-05 00:00:00 Sugar and Spice and Everything Nice: Buffett’s 50th Shareholder Meeting by William Smead of Smead Capital Management

The 50th annual meeting of Berkshire Hathaway with Warren Buffett as Chairman was filled with sugar and spice and everything nice. We at Smead Capital Management always look for three key takeaways from the annual meeting of Berkshire Hathaway. This year we think we can sum it up by using the 19th Century nursery rhyme.

2015-05-05 00:00:00 Americas: Economy Trends Update - April 2015 by Team of Thomas White International

Lower oil and commodity prices as well as changes in currency rates continue to be the main drivers of economic trends in the Americas. The weak export outlook for energy and commodities have hurt the prospects of large economies such as Brazil, which is expected to see a decline in economic output this year.

2015-05-05 00:00:00 Spring Cleaning: Time to Throw Out Some Old Asset Allocation Advice by David Robertson of Arete Asset Management

Many investors and advisors alike rest assured that the risk of stocks diminishes considerably as the holding period increases. This is only partly right as it overlooks a significant and extremely relevant risk.

2015-05-05 00:00:00 Re-Emerging Markets? by Russ Koesterich of BlackRock

With emerging markets showing surprising resilience, BlackRock Global Chief Investment Strategist Russ Koesterich discusses why investors should consider including EM equities in their portfolios.

2015-05-05 00:00:00 How to Dress for a Rainy Day by Niels Jensen of Absolute Return Partners

The answer is the Lollapalooza effect. The question you may recall from last month’s Absolute Return Letter - what’s the opposite of a perfect storm, or put another way, what do you call it when an unusual combination of constructive factors creates an outcome which is extraordinarily positive? A reader was kind enough to provide the answer, which was coined by Charles Munger years ago. As a non-American, the answer was at first complete gobbledygook to me, but a quick Google search convinced me that the answer is absolutely legitimate. Thank you.

2015-05-05 00:00:00 ISM Data for April Point to a Strong Rebound in U.S. Economic Growth In 2015 Q2 by Robert Lamy of The Forecasting Advisor

At the start of each month, the U.S. Institute for Supply Management (ISM) releases data on the state of the manufacturing and non-manufacturing industries of the U.S. economy. The data are closely followed by economists, stock market brokers and the media as they provide the earliest reading on the current state of the economy. The ISM provides data on the current performance of a number of indicators related to the manufacturing and non-manufacturing industries such as production, employment, new orders and backlog of orders, deliveries, inventories, new exports, imports and prices.

2015-05-05 00:00:00 The Real Financial Crisis That Is Looming by Lance Roberts of Streettalk Live

There is a financial crisis on the horizon. It is a crisis that all the Central Bank interventions in the world cannot cure. It is a financial crisis that will continue to change the economic landscape of America for decades to come.

2015-05-05 00:00:00 Too Late to Invest in EM? by Heidi Richardson of BlackRock

While emerging market stocks have had a good 2015 so far, this may still be an attractive time to invest for invest for investors who have been sitting on the EM sidelines.

2015-05-05 00:00:00 The Market Remains in Overvaluation Territory by Doug Short of Advisor Perspectives (dshort.com)

Here is a summary of the four market valuation indicators we update on a monthly basis.

2015-05-04 00:00:00 The Importance of Full Market Cycle Returns by Ryan Leggio, Steven Romick of FPA Fund

A full market cycle can be defined as a peak-to-peak period that contains a price decline of at least 15% from the previous market peak, followed by a rebound that establishes a new, higher peak.1 Few publications or data providers publish, let alone highlight, full market cycle returns, yet we believe understanding them can help the return of your portfolio over the long-term.

2015-05-04 00:00:00 Weighing the Week Ahead: Can Employment News Change the Fed’s Course? by Jeffrey Miller of New Arc Investments

This week’s economic news is mostly jobs-related. The Fed has cited employment as the most important factor in future rate decisions. There is plenty of FedSpeak on tap. Pundits love to talk about the Fed. Voila!

2015-05-04 00:00:00 A Sense of an Ending by Bill Gross of Janus Capital Group

Having turned the corner on my 70th year, like prize winning author Julian Barnes, I have a sense of an ending. Death frightens me and causes what Barnes calls great unrest, but for me it is not death but the dying that does so. After all, we each fade into unconsciousness every night, do we not?

2015-05-04 00:00:00 On My Radar: “The Rodney Dangerfield Expansion” by Steve Blumenthal of CMG Capital Management Group

"Earnings don't move the overall market; it’s the Federal Reserve board. And whatever you do, focus on the central banks and focus on the movement of liquidity. Most people in the market are looking for earnings and conventional measures. It's liquidity that moves markets." - Stan Druckenmiller

2015-05-04 00:00:00 The Long Reach of Technology in Taiwan by Jim Harvey, Dilip Badlani of The Royce Funds

Taiwan is one of the high-tech epicenters of the world, and while it headquarters some of the industry's most dominant players, the country is also home to a large and diverse group of smaller companies that provide a vital supporting role to the growing demands of the global markets.

2015-05-04 00:00:00 How The Headlines On GDP Growth Were Wrong by Urban Carmel of The Fat Pitch

GDP growth in the first quarter was, by various measures, among the best since the end of the recession. Real GDP grew 3.0%, the second highest growth rate in the past 5 years. GDP excluding inventories grew 2.5%, the third highest rate of growth in the past 8 years. Personal consumption grew 3.0%, the highest growth rate in 5 years.

2015-05-04 00:00:00 Two Point Three Sigmas Above the Norm by John Hussman of Hussman Funds

If you’re waiting for stocks to become overvalued by 2 standard deviations, we’re already past that, and we would not be at all surprised to observe another decade of negative total returns on the S&P 500, as we observed the last time valuations were similar on the most reliable measures.

2015-05-03 00:00:00 US Equity and Economic Review For the Week of April 27-May 1: Weak GDP Edition by Hale Stewart of Hale Stewart

The market has been trading at fairly expensive levels since the first of the year. With a current PE of nearly 21, it clearly needs economic and earnings growth to move higher. Unfortunately, last week’s news and the general earnings backdrop are not cooperating. First quarter GDP was reported at a meager .2% while Y/Y revenue growth contracted 4.1%. This led to small caps (both the IWM and IWC) breaking uptrends while the larger averages continued to languish. We’re again left with a picture of markets starved for bullish news and not receiving any.

2015-05-03 00:00:00 SPY's Trading Range is as Tight as December Before a 5% Drop by Urban Carmel of The Fat Pitch

The trading range for SPY is tighter now than at any time since December before a 5% drop. SPY's trading range is likely to expand and, on balance, it seems more likely that the expansion will be to the downside rather than the upside. That has been the most common outcome in the past and there are a number of supporting reasons to suggest that it will be the case this time as well.

2015-05-03 00:00:00 Show Me the Stocks, Not the Cash, Say Optimistic CEOs by Frank Holmes of U.S. Global Investors

In early March, I made the case that there’s no greater vote of confidence in a company’s growth prospects than when its top officers put some skin in the game and buy their own company stock. Among the examples I used were Warren Buffett, who owns millions of shares in Berkshire Hathaway; Elon Musk, who purchased over $100 million worth of Tesla stock in 2013; and myself, the largest shareholder of U.S. Global Investors. Another example of how bullish an executive is on his own company is when he chooses to forego a base salary entirely and instead be compensated in company stock.

2015-05-02 00:00:00 Asia Weekly China's Coming IPO Reform by Hardy Zhu of Matthews Asia

As China continues shifting toward a more market-based economy, what government powers are really being relinquished? Asia Weekly takes a look at changes in the IPO process.

2015-05-02 00:00:00 Pondering Halftime Adjustments by Rick Vollaro of Pinnacle Advisory Group

At the beginning of the year, we wrote about an aging bull market that we thought could be ridden, but with the caveat that one wouldn’t want to take too much risk given the magnitude of the move, current valuation levels in the U.S., and an overall evidence profile that was clearly mixed with pockets of both strength and weakness. When weighing the evidence, our dashboards offered no reason to reach for additional risk this late in the cycle, but instead we tried to focus on some big picture themes that could help us find attractive opportunities to position for.

2015-05-02 00:00:00 Where Is the Prudence in Macroprudential Policy? by Scott Minerd of Guggenheim Partners

Milton Friedman once said that “when that crisis occurs, the actions that are taken depend on the ideas that are lying around.” After the 2008–2009 financial crisis, there was no shortage of ideas for how to prevent catastrophic financial events from ever happening again. What ultimately resulted was forceful and wide-ranging regulatory responses that included Dodd Frank, the Volcker Rule, Basel III, Solvency II, the Federal Reserve Supplemental Leverage Ratios… the list goes on and on.

2015-05-02 00:00:00 Would More Government Debt Help the U.S. Economy? by Russ Koesterich of BlackRock

Russ explains why he’s skeptical that massive, debt-fueled government stimulus is what’s needed to accelerate the U.S. recovery.

2015-05-02 00:00:00 Hope Is Not A Strategy, Before Investing Have A Precise Calculation Of Return In Mind by Chuck Carnevale of F.A.S.T. Graphs

Many people make the mistake of investing in a stock simply with the hope or belief that it will or might go up in value. However, there is a very popular mantra that states “Hope is not a strategy.”

2015-05-02 00:00:00 Dollar Dictated Returns In April - Except This Time The Lowest Correlated Outperformed by Team of GaveKal Capital

With April in the rearview mirror, it's a good time to look back on which factors had the strongest relationship to market over the past month. USD correlation had the tightest relationship to the market.

2015-05-02 00:00:00 Companies Are Doing Much Better Than 1Q Financials Show by Urban Carmel of The Fat Pitch

Companies are doing much better than 1Q financial figures show. Energy sector EPS has fallen 60% in the past year; for the remaining 90% of the S&P, EPS is growing 7.5%. Only energy has seen a meaningful drop in margins; among the other large weighted sectors, margins are either close to flat or higher than a year ago. If oil prices can rise to $70 by the end of the 2015, the year over year impact of falling energy profit margins on total S&P EPS will become negligible.

2015-05-01 00:00:00 Brittle Britain by Anatole Kaletsky of Project Syndicate

Once a haven of political and economic stability amid the turmoil of the euro crisis, the United Kingdom is about to become the EU’s most politically unpredictable member. No amount of denial ahead of the May 7 general election will change that.

2015-05-01 00:00:00 High Yield Bonds: A Legislative History and the Opportunity Created by Tim Gramatovich, Heather Rupp of AdvisorShares

Throughout history of the high yield market there have been various legislative acts that have created and continue to create the market dislocation that allows investors an opportunity to produce what we see as attractive risk-adjusted returns.

2015-05-01 00:00:00 QE Posted On The Wall? by Sebastiao Buck Tocalino of SBTCapital Clube de Investimento

Pondering On Inflation, Corporate Debt, Dollar Exchange Rates, Oil Prices, NYSE Margin Debt, T-Bonds, China and Past QEs.

2015-05-01 00:00:00 Cross Currents by Anthony Valeri of LPL Financial

Cross currents continue to push and pull the bond market, leaving bond prices and yields range bound ahead of another Federal Reserve (Fed) meeting and key batch of monthly economic reports. Intermediate to long-term Treasury yields increased by 0.01% to 0.11% for the week ending April 24, 2015, despite weaker economic data.

2015-05-01 00:00:00 NYSE Margin Debt Charged To New All-Time Highs In March by Team of GaveKal Capital

After spending the past year somewhat ranged bound, margin debt increased by just under $11.5 billion in March to a new all-time high of $476 billion, taking out the previous high set in February 2014. The increase in margin debt over the past two months is the largest two-month increase since February 2013.

2015-05-01 00:00:00 Greece: Stuck in the Middle by J. Brooks Ritchey of Franklin Templeton Investments

Opinion polls show that many Greek voters support Athens's tough negotiation tactics. But the polls also show that most Greeks want their country to remain in the eurozone—but to do so would require agreeing with the zone's austerity demands. I think this would be the definition of a pickle.

2015-05-01 00:00:00 Yes, the Top 1 Percent Do Pay Their Fair Share in Income Taxes by Frank Holmes of U.S. Global Investors

In January 2014, I posted what has unexpectedly become one of my most widely-read articles, “What Does It Take to Be in the Top 1 Percent? Not as Much as You Think.”

2015-05-01 00:00:00 Emerging-Market Opportunities: Look Under the Surface by Vadim Zlotnikov of AllianceBernstein

Emerging markets seem to offer value for investors to tap into based on stock and bond valuations. But allocating more isn’t necessarily the answer. We think the value lies under the surface.

2015-05-01 00:00:00 After the Market Crisis: Does Diversification Still Work? by Russ Koesterich of BlackRock

Diversification may not have worked during the last market crisis, but this isn’t an argument for skipping exposure to international stocks.

2015-05-01 00:00:00 The Dollar Joins the Currency Wars by Nouriel Roubini of Project Syndicate

Until recently, US policymakers were not overly concerned about the dollar’s strength; America’s growth prospects were stronger than in Europe and Japan. But things look different today, and officials' exchange-rate jitters are becoming increasingly pronounced.

2015-04-30 00:00:00 Analysts Love to Talk about China but Should Focus on South Korea by Jeremy Schwartz of WisdomTree

This week Professor Siegel and Jeremy Schwartz chatted with Jeff Weniger, Investment Strategist at BMO Global Asset Management. We spoke at length about the impact of the U.S. dollar on global markets. I found our conversation about the impact of easy monetary policy on economies such as China and South Korea particularly noteworthy.

2015-04-30 00:00:00 Refrigerator vs. Restaurant: Where Are US Consumers Spending More? by Brian Horrigan of Loomis Sayles

A very interesting detail from April's retail sales report – for the first time in US history, consumer spending at restaurants and bars exceeded spending at grocery stores. In March, Americans spent $50.4 billion in restaurants and bars versus $50.1 billion in grocery stores.

2015-04-30 00:00:00 Finding Growth Amid Emerging-Market Slowdowns by Laurent Saltiel, Sergey Davalchenko of AllianceBernstein

Emerging markets have faced a significant economic slowdown in recent years. But there are still many industries and companies that are continuing to grow. We believe these are the places that investors should focus on to capture attractive return potential in developing-world equities.

2015-04-30 00:00:00 Key Seven Weeks Starts Now by Brian Wesbury, Robert Stein of First Trust Advisors

Don’t be confused by the Federal Reserve acknowledging the obvious slowdown in economic growth in the first quarter. The door to a June rate hike is still open. Not wide open, but much more open than most analysts and investors think.

2015-04-30 00:00:00 Celebrating Romania by Greg Konieczny of Franklin Templeton Investments

Ten years ago, Fondul Proprietatea (Fondul) was established to compensate Romanians whose properties were confiscated by the former communist government, and we were selected as its investment manager in September 2010. My colleague Grzegorz Konieczny, based in Bucharest, spearheaded the effort to list Fondul on the Bucharest Stock Exchange in 2011, and now Fondul is making its debut on the London Stock Exchange on April 29. In honor of the occasion, I’ve asked Greg to share his thoughts on investing in Romania today, and the exciting changes that have taken place there in the past few years

2015-04-30 00:00:00 The Step Down In Long-Term US Growth Rates Breaks Lower by Team of GaveKal Capital

From 1974 to 2007, the long-term US growth rate in real GDP generally fell between 3-3.5% on annualized basis (excluding the v-shaped bounce from 1982-1984). We define long-term here by looking at the 10-year annualized percentage change. With the 1Q now in the books, this series just dropped to an all-time low of 1.46%.

2015-04-30 00:00:00 Being There by Jeffrey Saut of Raymond James

Spring has definitely sprung here in Florida as pollen is in the air and raindrops fall on my tin roof with the sound of golf balls. “Tra la! It's May! The lusty month of May! That lovely month when ev'ryone goes blissfully astray,” to steal a line from the play Camelot. But many market pundits are worried about the softening economic reports, prompting me to dredge up my annual missive about the book “Being There” by author Jerzy Kosinski. The story revolves around a simple-minded man named Chance “the gardener,” who knows only gardening and what he sees on television.

2015-04-30 00:00:00 Why 2015 Does Not Look Like Y2K by Russ Koesterich of BlackRock

Russ explains why today’s U.S. technology rally is different from the tech bubble we experienced back in 2000. The technology-heavy Nasdaq Composite Index hit a new record last week, as a broader rally in stocks helped nudge it past its 2000 peak. At the same time, mergers and acquisitions (M&A) and initial public offering (IPO) activities continue to gather speed.

2015-04-30 00:00:00 Carry Scares by Alexander Giryavets of Dynamika Capital L.L.C.

With Bill getting what he wants Bunds sell-off, and so does Global Carry (a.k.a. Risk Parity), as we warned last week, confirming that perfect correlation between the two is alive and well. Dollar unwind should not be surprise to anyone given now hardly arguable US deceleration at hands of which we warned all along, but the hidden Yen deleveraging that steepens US treasury yield curve is something to watch closely.

2015-04-30 00:00:00 The Ideology of IS by Bill O’Grady of Confluence Investment Management

Atlantic Magazine recently published an article about Islamic State (IS) that examined its theology and ideology. This article along with a paper from the Brookings Institute form the basis of our report. In our report this week, we examine the intellectual foundations of IS, showing how it evolved from two different sources of thought. We follow with an analysis of the concept of the Caliphate and the critical importance it has in Islamic theology, along with an examination of the eschatology of IS. We discuss the consequences of IS’s ideology and conclude with potential market ramification

2015-04-30 00:00:00 Finding Large Opportunities in Small-Cap Stocks by Jason Holzer of Invesco Blog

While the world’s expectations for US earnings growth have weakened into nearly single digits, Europe is finally seeing some positive developments after years of headwinds. At the same time, European valuations are about 40% cheaper than those in the US on the basis of the Schiller price-to-earnings ratio.1 As we survey the brightening landscape in Europe, looking for companies that meet our criteria for earnings, quality and valuations (EQV), an especially interesting area for us is in the small-cap market.

2015-04-30 00:00:00 Finding Opportunities in Dividend Paying Equities by (Article)

Alex Crooke provides a portfolio and economic update for the Henderson Global Equity Income Fund (HFQAX). Alex notes that he is currently favoring defensive sectors on valuations as well as income and has been increasing the Fund’s allocation to Europe. Broadly speaking, Alex sees the world growing at a reasonable rate with unemployment is falling in many markets which should lead to better/greater consumer spending. He notes that though equity prices are higher than they have been, there is still good value and strong dividend growth in many sectors and regions.

2015-04-30 00:00:00 Breaking Out of Bondage by Ben Inker of GMO

In a new quarterly letter to GMO's institutional clients, co-head of asset allocation Ben Inker provides the basis for future bond returns: "For while it is unlikely that stock investors are going to achieve anything like as strong a return over the next 30 years as they did over the last, it is basically impossible for bond investors to duplicate their feat." ("Breaking Out of Bondage").

2015-04-30 00:00:00 Are We the Stranded Asset? by Jeremy Grantham of GMO

In part two of the letter, chief investment strategist Jeremy Grantham examines the factors behind declining estimates of U.S. and overseas GDP growth, and offers an outlook for the coming years ("Are We the Stranded Asset? (and other updates)").

2015-04-29 00:00:00 Why It’s Good to Be Young in Japan by Christopher Gannatti of WisdomTree

At the Japan Society event “The Sun Also Rises?: Japan’s Potential in the Post-Crisis Global Economy,” we heard panelists talk about how they thought that Japan could incentivize growth in productivity. One area of note was that Japan’s largest industrial employer shifting from seniority-based pay to pay for performance was a very big step.

2015-04-29 00:00:00 Crouching Tigers, Hidden Assets by William Smead of Smead Capital Management

Our experience tells us that Crouching Tigers, while appearing contentious and dangerous, often have hidden assets. These assets can potentially turn out-of-favor common stocks into future winners.

2015-04-29 00:00:00 MLPs Waxing not Waning by David Chiaro of Eagle Global Advisors

We view the recent sell off of MLPs/midstream energy infrastructure companies as a buying opportunity. Our long-term evaluation of the total return prospects of these companies is very good, especially on a risk adjusted basis.

2015-04-29 00:00:00 Do More Americans Feel Confident About Retirement? by Gary Halbert of Halbert Wealth Management

More Americans say they are feeling more confident about their retirement. That’s according to the results of the latest “Retirement Confidence Survey” conducted each year by the non-profit Employee Benefit Research Institute (EBRI). The Washington-based EBRI is the leading source for data on savings, retirement, health and related issues.

2015-04-29 00:00:00 Risk Marches On by Burt White of LPL Financial

The latest data releases pointing to weak U.S. new home sales and manufacturing Purchasing Managers’ Index (PMI) have investors guessing about the possible messaging coming out of this week’s Federal Open Market Committee (FOMC) meeting.

2015-04-29 00:00:00 The Smart Money Is Getting Long Treasury Bonds Again by Team of GaveKal Capital

Long-dated US Treasury bonds have been treading water of late, leaving many rate watchers wondering in what direction the next big move is going to be. One variable in the next move is of course trader positioning. The two charts below show how the "smart money" is betting.

2015-04-29 00:00:00 China Officials Dig in on Stronger RMB by Hayden Briscoe of AllianceBernstein

Recent events in China provide yet more support for our view that the renminbi (RMB) will continue to appreciate steadily—and that the country will proceed more rapidly with its reforms than most people expect.

2015-04-29 00:00:00 The Pause in Capital Spending by Scott Brown of Raymond James

The Bureau of Economic Analysis will report its initial estimate of first quarter growth on April 29. There’s always a lot of uncertainty in the advance estimate, but that’s especially true for 1Q15. Of the key components of GDP, consumer spending is expected to have slowed to a more moderate pace – nothing terrible. However, business fixed investment should be soft. For business investment, as with manufacturing activity in general, it’s often difficult to distinguish a short-term slowdown from the beginning of a more significant downturn.

2015-04-29 00:00:00 Funded Status of Largest Corporate Pension Plans Drops by $6 Billion in March by John Ehrhardt, Zorast Wadia of Milliman, Inc.

The funded status of the 100 largest corporate defined benefit pension plans dropped by $6 billion during March as measured by the Milliman 100 Pension Funding Index (PFI). The deficit increased to $349 billion from $343 billion at the end of February because of the dual effect of a decline in the benchmark corporate bond interest rates used to value pension liabilities and flat asset performance in March. As of March 31, the funded ratio fell to 81%, down from 81.2% at the end of February.

2015-04-29 00:00:00 Newsletter by Harold Evensky of Evensky & Katz

Harold Evensky presents his quarterly newsletter.

2015-04-28 00:00:00 Does Lipper's Best Overall Fund Company Beat a Passive Strategy? by Larry Swedroe (Article)

Lipper recently gave financial services firm TIAA-CREF the award for "Best Overall Large Fund Company", making 2015 the first time any fund family has won this honor for three consecutive years. Among its actively managed peers, TIAA-CREF's funds did exceptionally well. But does that mean your clients benefitted by owning its funds?

2015-04-28 00:00:00 Five Words that Shape Client Behavior by Dan Richards (Article)

Financial advisors know the difficulty of getting clients to do the right things. Clients often fail to diversify portfolios, rebalance out-of-whack allocations or discuss inheritance plans with adult children. These behaviors undermine long-term outcomes. But five words can put the right default behavior in place.

2015-04-28 00:00:00 Seven Interview Questions to Hire a Sales Superstar by Eliot Burdett (Article)

Here are the seven most common personality traits found in top sales performers and tips to determine if the candidate across the table truly possesses them.

2015-04-28 00:00:00 Reasonable Expectations, Warren Buffett and Active Management by Michael Crook (Article)

According to the ongoing SPIVA analyses, most equity mutual fund managers have failed to keep up with their respective benchmarks recently. In fact, roughly 60% of domestic managers and 65-70% of international managers underperformed in 2014 - a phenomenon that most investors observed in their own portfolios. But that is not a reason to abandon active management, assuming you own active managers for the right reasons.

2015-04-28 00:00:00 Speed Date Your Way to More Clients by Daniel Solin (Article)

New research on speed dating has uncovered how to determine a woman's interest. Strangely enough, those findings also provide insight into why certain sales tactics with prospects are likely to fail.

2015-04-28 00:00:00 Q1 2015 Venerated Voices™ by Jill Mislinski (Article)

We announced our Venerated Voices awards for articles published in Q1 of 2015. Rankings were issued in three categories: The Top 25 Venerated Voices by Firm, The Top 25 Venerated Voices by Author and The Top 10 Venerated Voices by Commentary.

2015-04-28 00:00:00 Getting Centers of Influence to Refer by Beverly Flaxington (Article)

We have a number of strategic alliances with estate attorneys and CPAs to whom we often refer business. We provide a steady flow to these connections, but they do not refer in kind. Is there a formula that works best to stimulate referrals?

2015-04-28 00:00:00 Build Your Business by Being Charitable by Teresa Riccobuono (Article)

One of the unintended benefits of being charitable is being exposed to new business opportunities. Let's discuss a few ways to become involved.

2015-04-28 00:00:00 The Fed's Countdown to Liftoff by Kristina Hooper of Allianz Global Investors

Kristina Hooper, US Investment Strategist for Allianz Global Investors, previews the upcoming FOMC meeting and its implications for the first interest-rate hike since 2006: "Suffice it to say that the Taylor Rule, which fairly accurately predicted the fed funds rate from 1988 through 2008, might as well be in my attic with my Duran Duran albums, Benetton rugbies and other vestiges of the '80s and '90s..."

2015-04-28 00:00:00 Equities Should Push Higher Along a Bumpy Road by Robert Doll of Nuveen Asset Management

Investors mostly focused on the positives last week. Corporate earnings generally beat expectations and merger and acquisition activity remained solid. Despite disappointing economic data, this trend reinforced the perception that the Federal Reserve would hold off on rate hikes for the time being. The turmoil in Greece rattled investors, but remains relatively contained.

2015-04-28 00:00:00 Tracking the Market with Social Media by Blair Jensen of Trade Followers

Sentiment and momentum calculated from the Twitter stream for the S&P 500 index (SPX) is still confirming the uptrend, but has turned down as the market rises. This shows a lack of confidence by traders on Twitter that the market can move immediately to new all time highs.

2015-04-28 00:00:00 M&A: Bubble Trouble Ahead? by Milton Ezrati of Lord Abbett

Talk of an unsustainable surge in mergers and acquisitions is premature. The current level of activity suggests that corporate managers will continue to buy rather than build.

2015-04-28 00:00:00 Mythbusters: Style Performance During Bear Markets by Doug Ramsey of Leuthold Weeden Capital Management

Will Rogers said, “It isn’t what we don’t know that gives us trouble, but what we know that ain’t so.” Investors have long “known” that Value stocks provide a safer place to hide than Growth stocks during a cyclical bear market, an assumption probably based on: (A) experience since the early 1970s; and (B) common sense, in that speculative investments with low price tags and low expectations should be expected to suffer less when animal spirits deflate.

2015-04-28 00:00:00 Are You Financially Literate? by Jerry Wagner of Flexible Plan Investments

That is the question being asked throughout the month of April, which is designated as National Financial Literacy Month. This effort highlights the importance of financial literacy and supports teaching Americans on how to establish and maintain healthy financial habits.

2015-04-28 00:00:00 That Silly Mr. Market by Kendall Anderson of Anderson Griggs

I’m sure you remember my friend Mr. Market. He was introduced to me a few years after I entered the business of investment advice via Ben Graham’s book The Intelligent Investor, and for most years since I have found him to be quite fair and reasonable. Whether I wanted to sell or buy any one of the thousands of securities available to the public, he would make an intelligent opinion of its value and proceed to close the deal at that price.

2015-04-28 00:00:00 As Milestones Are Crossed, Be Selective by Russ Koesterich of BlackRock Investment Management

Stocks around the world rewrote the record books last week. In the United States, the Nasdaq Composite Index eclipsed its 2000 peak, advancing 3.26% to close the week at 5,092. In Japan, the Nikkei Index climbed above 20,000 for the first time in 15 years, while China's equity market continues to defy gravity.

2015-04-27 00:00:00 Forecasting Q1 GDP: Gazing Into the Crystal Ball by Doug Short (Article)

The big economic number this week will be the Q1 Advance Estimate for GDP on Wednesday at 8:30 AM ET. What do economists see in their collective crystal ball for Q1 of 2015? Let's take a look at the GDP forecasts from the latest Wall Street Journal survey of economists conducted earlier this month.

2015-04-27 00:00:00 Fair Value on the S&P 500 Has Three Digits by John Hussman of Hussman Funds

We continue to classify market conditions among the most hostile expected return/risk profiles we identify. The current profile joins rich valuations with continued evidence of a subtle shift toward risk aversion among investors, which we infer from market internals (a variant of what we used to call “trend uniformity”), credit spreads, and other risk-sensitive measures.

2015-04-27 00:00:00 Stock Splitting Caused Stock Market Crash 1929 by Wim Grommen of Transfer Solutions

This article explains why the introduction of stock splitting on December 31st, 1927 eventually caused the crash of 1929. The frequent splitting of shares into very large proportions gave a massive boost to the stock market boom, making the stock market crash of 1929 equally violent.

2015-04-27 00:00:00 Spring Quarterly Commentary by John Prichard, Miles Yourman of Knightsbridge Asset Management

Charlie Munger, firmly ensconced in the investor hall of fame, remains, at age 91, one of our favorite purveyors of worldly wisdom on subjects investment related and otherwise. He is also known to be blunt and humorous, offering the above response to a question regarding money-printing, interest rates and unintended consequences at the Daily Journal shareholder meeting a few weeks ago. When a genius like Charlie is confused...then things indeed are confusing.

2015-04-27 00:00:00 Foreign Factors by Anthony Valeri of LPL Financial

Gauging foreign demand for U.S. bonds, Treasuries in particular, is a constant source of attention for bond investors, with foreign ownership of outstanding U.S. Treasuries remaining fairly constant at approximately 50% over the past few years.

2015-04-27 00:00:00 Airlines Report on Q1 Earnings by Frank Holmes of U.S. Global Investors

A recent Deutsche Bank report projects a total airline industry first-quarter pretax profit of $3.5 billion, up from $700 million this time last year—a 400-percent improvement.

2015-04-27 00:00:00 Weighing the Week Ahead: Time for an Upside Breakout? by Jeff Miller of New Arc Investments

We have the makings of a volatility cocktail! It is a huge week for economic data. It is the heart of earnings season, with Apple’s report leading off the week. The Fed has a two-day meeting culminating with a policy announcement. Global economic threats continue. Which of these will be the theme?

2015-04-27 00:00:00 Significant Slip—or Just a Blip—in Emerging Markets’ Foreign Exchange Reserves? by Mark Mobius of Franklin Templeton Investments

For those looking to invest in emerging markets, a steady growth in foreign exchange reserves—in many cases to higher levels than in most developed markets—has been a positive talking point for the past two decades. This reserve build-up has allowed emerging markets to be dominant buyers of US and European debt. However, a general decline in emerging market foreign reserves last year now has pundits pondering whether there is danger of more significant slippage with potentially ominous market implications.

2015-04-27 00:00:00 Revisions Have Improved But Can It Last? by Team of GaveKal Capital

The percent of stocks in the MSCI World Index that have had positive EPS revisions compared to six months ago currently stands at 45%. Over the past 7+ years, the average level of this statistic is 56%. So it currently stands below average levels but encouragingly it has improved from a low of 30% set on January 14th.

2015-04-27 00:00:00 Growth Is Becoming More Valuable by Frank Caruso, Christopher Kotowicz of AllianceBernstein

Precious gems, Old Masters artwork and certain brands of scotch: scarcity makes them more desirable and adds to their value. The same can be said of organic growth. As the economic cycle matures, we expect the stocks of companies that have it—and can maintain it—to become increasingly prized.

2015-04-27 00:00:00 Time to Love Emerging Markets Again? by (Article)

45-year industry veteran, Tom White, CIO of Thomas White International, returns to offer his thoughts on what he feels are the most promising emerging markets for this year and beyond. He also explains why investors worried about a repeat of the ‘2013 taper tantrum’ may be missing the big picture.

2015-04-27 00:00:00 On My Radar: Recession Watch – Keep an Eye on This Chart by Steve Blumenthal of CMG Capital Management Group

Understanding when a recession might begin is important to our long-term financial health. Why? The stock market declines approximately 40% during recessions.

2015-04-27 00:00:00 Investment Trends Shaping Our Industry’s Future by Patty Quinn McAuley of Clark Capital Management Group

I attended iShares Connect in New York last week, a conference focused on bringing together industry leaders in the ETF space. Attendees heard from a variety of investment experts and thought leaders and had an open dialogue about where our industry is headed.

2015-04-27 00:00:00 Where's the Hyper-Inflation? by Brian Wesbury, Bob Stein of First Trust Advisors

If we had a dollar for every time we’ve heard about the threat of hyperinflation, we’d probably have enough money to never worry about it.

2015-04-26 00:00:00 US Equity and Economic Review For the Week of April 20-24: Is This Another False Break-Out?, Edition by Hale Stewart of Hale Stewart

After a series of first quarter economic disappointments, last week’s financial news provided much needed ammunition for optimism. The latest new and existing home sales numbers indicated the housing market is healing while the slight uptick in durable goods orders stopped that data series’ recent set of declines. The markets rallied as a result, printing at or close to new highs. The market’s technical picture, however, is still unconvincing; the SPYs chart looks like a short term top while the Transports and Dow’s failure to confirm the QQQ’s recent advance adds to the caution.

2015-04-26 00:00:00 The Third and Final Transformation of Monetary Policy by John Mauldin of Mauldin Economics

My good friend Dr. Woody Brock makes the case that an unintended consequence of QE is that the Federal Reserve’s normal transmission of monetary policy through periodic changes in the fed funds rate has been vitiated. He contends that soon we will no longer care about the fed funds rate and will be focused on other sets of rates.

2015-04-25 00:00:00 Why International Diversification Matters Today by Russ Koesterich of BlackRock Investment Management

The tendency of U.S. investors to invest close to home is understandable, but it’s not optimal. Russ has three reasons why international diversification matters now more than ever for U.S. investors.

2015-04-25 00:00:00 Sustaining The New Highs in Equities Might Prove Difficult by Urban Carmel of The Fat Pitch

New price highs are usually bullish as all investors are in a profitable position and not in need of selling. We don't like to be cautionary when price is bullish, but the reality is that prior moves to new highs have failed in the past year and several measures of breadth, sentiment and volatility suggest that is likely to be the case again now.

2015-04-24 00:00:00 Searching for Clarity Among the Dots by Carl Kaufman, Simon Lee, Bradley Kane of Osterweis Capital Management

In 1886 Georges Seurat finished his most famous painting, A Sunday Afternoon on the Island of La Grande Jatte. Seurat used a new technique, Pointillism, in which small dots of color are applied to the canvas to express an image. More recently, Janet Yellen and the Federal Open Market Committee (the FOMC) updated their own version of Pointillism to express an image called the dot plot – a graphical representation of each FOMC member’s forecast of future federal funds (fed funds) rates.

2015-04-24 00:00:00 BofA Is Confusing Liquidity Fueled And Secular Bull Markets by Lance Roberts of Streettalk Live

Over the past couple of years, there has been a growing chorus of individuals claiming that the financial markets have finally shaken the shackles of the secular bear market that began at the turn of the century. This, of course, suggests that the markets have now begun the next long-term secular bull market.

2015-04-24 00:00:00 Going Fast or Going Far by Michael Kayes of Willingdon Wealth Management

The college basketball season ended in historic fashion recently with two iconic coaches reaching new pinnacles in their profession. Coach K at Duke won his fifth national championship moving him past legendary Kentucky coach Adolph Rupp into second place all-time. Meanwhile, on the women's side, Geno Auriemma led Connecticut to its 3rd consecutive title, and 10th overall under his reign.

2015-04-24 00:00:00 Asian Markets Host Potential for Long Term Growth by (Article)

In this latest video update, Sanjeev Lakhani, CFA, Co-Portfolio Manager of the International Select Equity Fund, highlights a recent trip to Asia and discusses why India, Indonesia, China and Japan offer long term growth. Historically, China has been a difficult market to invest in, however, there do appear to be signs that it is changing. India and Indonesia both have reform-minded leaders who plan to invest in their countries infrastructure. India has reduced its account deficient and has benefited from low oil prices.

2015-04-24 00:00:00 Global Divergence, the Federal Reserve and the Impact on U.S. Insurers by David Braun, Scott Millimet of PIMCO

Insurance publication SNL Financial recently sat down with members of PIMCO’s Financial Institutions Group to discuss PIMCO’s latest views on global divergence, the Federal Reserve and the impact on U.S. insurers in their investment portfolio positioning.

2015-04-24 00:00:00 China's First SOE Default: More to Come? by Teresa Kong of Matthews Asia

A power equipment maker just became China’s first state-owned company to default on domestic debt. Is this a strategic move by the central government to further liberalize its capital markets, and to reform its state-owned enterprises?

2015-04-24 00:00:00 The Right Tool For The Job of Active Management by Team of GaveKal Capital

Market-cap weighted indexes such as the MSCI global equity indexes are commonly used reference points for investment benchmarking. In these indexes, the market cap of the top 10% of the stocks is generally 50% of the market cap of the index.

2015-04-24 00:00:00 Global Economic Perspective: April by Team of Franklin Templeton Investments

Given the example set by US equity markets after the Fed stepped in to buy government debt in two successive QE programs, investors appear convinced that the rally in European financial markets has considerably longer to run.

2015-04-24 00:00:00 Sine of the Times by Scott Minerd of Guggenheim Partners

Powerful secular and fundamental forces at work signal that the risk to U.S. interest rates remains to the downside.

2015-04-24 00:00:00 Weekly Economic Commentary: The Eurozone Is Seeing Green Shoots but Isn’t Out of the Woods by Carl Tannenbaum of Northern Trust

The Eurozone Is Seeing Green Shoots but Isn't Out of the Woods; Gauging a Country's Potential for Growth; The Trans-Pacific Partnership Might Actually Happen

2015-04-24 00:00:00 Stand and Deliver: Will the US Economy Rebound as Expected in the Second Quarter? by Russ Koesterich of BlackRock Investment Management

Most market watchers are blaming another bad winter for this year’s rough start, and they’re assuming a strong second-quarter rebound. One obscure economic statistic calls that view into question.

2015-04-24 00:00:00 Attractively Valued Ameriprise Financial: a Long-Term Total Return Opportunity Raises Dividend 16% by Chuck Carnevale of F.A.S.T. Graphs

Ameriprise slightly missed their earnings estimates for the first quarter of fiscal 2015, and the stock has dropped over 3%. However, their return on equity increased to a record high 23.1 % and operating earnings were up 7%. Management appears to remain confident about the future as evidenced by the raising of their quarterly dividend 16% to $0.67 per share. Consequently, I consider the recent weakness an excellent opportunity for long-term oriented investors desirous of earning an above-average total return.

2015-04-24 00:00:00 Schwab Market Perspective: Heads, Bulls Win; Tails, Bears Lose? by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

The bears can’t seem to grab hold of this market, but that doesn’t mean full-speed ahead for the bulls either. Grinding generally higher with increased volatility seems to be the course for now, but the possibility of a correction still exists. Diversification, discipline and patience is required. International equity exposure should be part of most investors’ portfolios, to a level commiserate with risk tolerance. European risks related to Greece seem to have lessened, while the Chinese stock market doesn’t appear grossly overvalued, although a pullback from the recent run is possi

2015-04-23 00:00:00 U.S. Consumers Gaining Ground by John Osterweis, Matt Berler of Osterweis Capital Management

In early 2015 global financial markets continued to be buoyed by a combination of low interest rates, central bank liquidity and positive, albeit modest, economic growth. For some time we have been talking about the "Goldilocks" backdrop of slow growth, low inflation and low interest rates that has been very rewarding for financial assets.

2015-04-23 00:00:00 Tax Receipts Flash Economic Warning Sign by Lance Roberts of STA Wealth Management

With "tax day" now firmly behind us, it is expected that 2015 will show a record level of tax collections. This is a good thing, right? Maybe not.

2015-04-23 00:00:00 Could Aflac’s Contentiousness Spell Wealth Creation? by William Smead of Smead Capital Management

At Smead Capital Management, we like to combine the qualitative aspects of a meritorious company with the temporary contentiousness of deeply out-of-favor psychology. We have found in our research that using qualitative attributes alone can be very expensive. Additionally, we feel that just buying stocks off of the out-of-favor junk pile can lead you to bankruptcy court if the companies fail to turnaround.

2015-04-23 00:00:00 Meandering Continues for Silver & Gold by Avi Gilburt of ElliottWaveTrader.net

While the metals continue to meander, I still remain bullish over the next few months, and bearish into later this year. And, yes, I still believe that lower lows will be seen, as the final lows to the 3+ year correction have not yet been seen.

2015-04-23 00:00:00 Where Banks Are Performing Well In The World by Team of GaveKal Capital

There is an old belief that when bank stocks are doing well, the economy must be doing well also. With this in mind, we decided to take a look how the banking sectors have performed in seven different countries: USA, Germany, United Kingdom, France, Japan, China, Brazil.

2015-04-23 00:00:00 Emerging Markets Winners and Losers: Q1 2015 by Jackie Lafferty of Loomis Sayles

2015 kicked off with a rocky start for emerging markets: pending US rate hikes, falling commodity prices, quantitative easing in Europe, and idiosyncratic country risks all soured investor sentiment and caused the US dollar to soar. This led to substantial weakness in emerging market (EM) foreign exchange, pummeling US-based investors in many local currency bond markets. Despite that pain, EM credit performed well, and along with EM sovereign debt, posted positive gains.

2015-04-23 00:00:00 To Hedge or Not To Hedge by Treesdale Partners of AdvisorShares

There have been several blogposts on the merits of buying currency hedged ETFs for foreign equity exposure versus unhedged exposure. The arguments against unhedged ETFs are weak and often false, like “the companies hedge their currency exposure already”.

2015-04-23 00:00:00 Lower Oil Prices Have Varied Effect on Municipal Bond Market by Stephanie Larosiliere of Invesco

The decline in oil prices since the summer of 2014 continued throughout the first quarter, as oil supply surpassed demand and we saw substantial price declines. This is of particular interest to municipal bond investors, as many US state and local budgets have a substantial dependence on oil production and exploration revenue, and lower oil prices can influence economic growth and inflation, which can affect Treasury and municipal yields.

2015-04-22 00:00:00 Sizing Up Small Caps by Burt White of LPL Financial

The Russell 2000 Index hit a fresh all-time high last week (on tax day, April 15, 2015) and has outpaced large caps by 205 basis points (2.05%) year to date. Although valuations are on the high side, the factors that have driven recent small cap strength, in our view, remain largely intact. Small cap technicals appear bullish, with positive relative strength and an upward sloping 40-week moving average.

2015-04-22 00:00:00 Bill’s “Short of a Lifetime” by Alexander Giryavets of Dynamika Capital L.L.C.

According to Bill Gross “German 10yr Bunds = The short of a lifetime.” We just wanted to make it clear that the Bunds were perfectly co-moving with the Global Carry over the last six years and the Global Carry is the major source of returns behind US equities, bonds, the Risk Parity portfolios, and 60/40 for that matter.

2015-04-22 00:00:00 Gimme Shelter: The U.S. Dollar Trade and Its Risks by Michele Mazzoleni of Research Affiliates

By selling foreign currencies to take advantage of the dollar’s appreciation, U.S. investors are increasing their exposure to the risk of an economic slowdown at home.

2015-04-22 00:00:00 How Organization Promotes Successful Outcomes by Patty Quinn McAuley of Clark Capital Management Group

By delivering a realistic road map to clients, illustrating their financial future, you can help them remain confident and on course toward successful outcomes.

2015-04-22 00:00:00 Is Volatility Making a Comeback in Europe? by Team of GaveKal Capital

Having fallen from the recent highs earlier this year, various metrics of volatility in Europe have risen abruptly in the last few days-- especially when viewed in the context of a rather subdued VIX (a measure of expected market volatility conveyed by S&P 500 options prices; represented by the light blue line below).

2015-04-22 00:00:00 Is Greece Nearing the End of the Road? by Darren Williams of AllianceBernstein

Greece and its euro-area partners have yet to reach a deal to secure long-delayed bailout funds. Without these funds, Greece could run out of money in a matter of weeks, raising the real prospect of a default on payments due to its official creditors.

2015-04-22 00:00:00 One Silver Lining of Slower Global Growth by Russ Koesterich of BlackRock

Russ explains why today’s economic environment, characterized by monetary stimulus meant to combat slower-than-expected economic growth, is helping many of the large, global financial firms.

2015-04-22 00:00:00 Uncertainty by Scott Brown of Raymond James

We live in an uncertain world. Policymakers have to sift through a wide range of data, much of which is subject to statistical error and measurement difficulties. Financial market participants deal with much of the same data, but also have to account for the uncertainty in how policymakers will interpret the data and respond. There are longer-term questions, which won’t be resolved anytime soon. So where do we stand now?

2015-04-22 00:00:00 Activity Versus Inactivity by Jeffrey Saut of Raymond James

Plainly there are times for investors/traders to be active. But there are also times for them to be inactive, despite the trait of human nature to be “active;” and, for the past few months inactivity has been the best overall strategy.

2015-04-22 00:00:00 House of the Rising Sun: Is Housing Staging a Turn for the Better? by Liz Ann Sonders of Charles Schwab

Economic data has been mixed-to-weak over the past few months; but some of the housing-related data has perked up and could be a bright spot for the economy in the medium-term. Some recent highlights include single-unit permits, pending and new home sales, mortgage applications, building materials sales, anecdotal strength via the Fed’s Beige Book, and the well-watched Housing Market Index (HMI), put out by the National Association of Home Builders (NAHB).

2015-04-22 00:00:00 Four Bad Bears: Some Comments from Bob Bronson by Doug Short (Article)

Earlier today I received an email from my friend Bob Bronson of Bronson Capital Markets Research. Bob offered some comments on the latest update in my periodic overview of bear market recoveries:

2015-04-21 00:00:00 The Best Asset Allocation for Retirees by David Blanchett (Article)

In this article, I determine the optimal glide path for retirees using varying initial bond yields and stock market valuations.

2015-04-21 00:00:00 Should Leveraged ETFs Be Held for Long Horizons? by C. Thomas Howard, Lambert Bunker and David Stock (Article)

There are numerous misconceptions and emotions surrounding the use of leveraged ETFs. This article provides a simple and clear explanation of how these instruments can be used to enhance portfolio returns over longer term investment horizons. We show that commonly used 2x ETFs have delivered the expected return over multi-year time horizons.

2015-04-21 00:00:00 How to Attract Top Talent by Dan Richards (Article)

How should you recruit and motivate top-performing support staff?

2015-04-21 00:00:00 Success Is Within Your Control by Daniel Solin (Article)

You may be skeptical of the expression, "The harder I work, the luckier I get." But empirical evidence says it's true. While we often look with envy at people who get a "lucky break", the reality is that the vast majority of those people worked long and hard before they achieved success.

2015-04-21 00:00:00 Closing the Retirement Gender Gap by Jeff Briskin (Article)

New research shows how a lack of "retirement readiness" puts many women at risk of financial hardship during their retirement years, especially since most will outlive their spouses.

2015-04-21 00:00:00 When Lead Advisors Are Not Mentors by Beverly Flaxington (Article)

I am working to establish a training program that would match a newer advisor with one of our more seasoned ones. So far, this has been a disaster. The lead advisors treat the newer people like administrative staff. How do I teach my lead advisors to be better mentors?

2015-04-21 00:00:00 Profit Margins - Is the Ladder Starting to Snap? by John Hussman of Hussman Funds

Since mid-2014, the broad market as measured by the NYSE Composite has been in a broad sideways distribution pattern, with an increasing tendency in recent months for advances to occur on weaker volume and declines to follow on a pickup in volume. While capitalization-weighted indices have done somewhat better since mid-2014, the S&P 500 Index is unchanged since late-December.

2015-04-21 00:00:00 Roller Coaster Quarter by Jim Tillar and Steve Wenstrup of Tillar-Wenstrup Advisors

Volatility continues to be the theme for stocks. The S&P 500 was down big in January, rallied even bigger in February and went down again in March ending the quarter up 0.95%. The real action was in Europe where stocks clocked double-digit returns.

2015-04-21 00:00:00 Rear-View Mirror Shows Ugly Q1 by Brian S. Wesbury and Robert Stein of First Trust Advisors

We know Plow Horses don’t have rearview mirrors, but economists do. So, let’s not beat around the bush: the economy barely grew last quarter. Right now, we’re forecasting that real GDP expanded at a 0.7% annual rate in Q1.

2015-04-21 00:00:00 Social Security & Portfolio Withdrawals; It’s Complicated by Roger Nusbaum of AdvisorShares

The Wall Street Journal ran a blog post that outlined Michael Kitces’ argument for delaying Social Security which can be summed up by saying it should be thought of it as an asset in a portfolio so by waiting, the value of your asset grows.

2015-04-21 00:00:00 Can Lumber Be Worth It's Weight in Gold? by Jerry Wagner of Flexible Plan Investments

Well, maybe not literally. But figuratively-speaking, one can make the case. And two very bright, young investment advisors have done just that.

2015-04-21 00:00:00 U.S. Budget: The Fiscal and Political Calculations by Milton Ezrati of Lord Abbett

A compromise budget from the House and Senate will not affect U.S. revenues and spending—but it may help Republicans frame key policy debates ahead of the 2016 election.

2015-04-21 00:00:00 Pregnant Pause by Adam Bowe and Robert Mead of PIMCO

After re-engaging policy support in February following an 18-month hiatus, the Reserve Bank of Australia (RBA) wrong-footed many in the market by keeping policy on hold in the two subsequent board meetings. So was February's decision a "one-and-done" policy event or the start of a more aggressive easing cycle?

2015-04-21 00:00:00 QE: The Silver Lining of Slower Growth by Russ Koesterich of BlackRock

Stocks struggled last week amid more evidence that economic growth is not accelerating as expected. In the United States, the S&P 500 Index fell 0.99% to 2,081, the Dow Jones Industrial Average dropped 1.28% to 17,826, and the Nasdaq Composite Index lost 1.30% to close the week at 4,931.

2015-04-21 00:00:00 The AIIB by Bill O’Grady of Confluence Investment Management

China has founded the Asian Infrastructure Investment Bank (AIIB) to compete with the World Bank and the Asian Development Bank. The U.S. has opposed the creation of this bank but, despite administration opposition, 57 nations have joined. A chorus of commentators have suggested that the founding of this bank may mark the end of U.S. hegemony. In this report, we describe the AIIB, including its members and capitalization. Next, we cover the conventional wisdom surrounding the bank, and follow up with our analysis of the real impact of the bank. We conclude with potential market ramifications.

2015-04-21 00:00:00 Stay Patient Against the Consensus Trade of 2015 by Kathleen Gaffney and Matt Hildebrandt of Eaton Vance

When making moves that are against a crowded trade, does it pay to be a patient, opportunistic income investor?

2015-04-21 00:00:00 Something To Keep In Mind During Earnings Season... by Team of GaveKal Capital

As we enter the heart of the S&P 500 1Q earnings season, and the CNBCs of the world focus on the number of companies that (surprise) beat earnings expectations once again, remember this fact: earnings expectations have been beaten down over the past six months. Let's take a quick tour of the developed world to illustrate this point.

2015-04-21 00:00:00 Good Things To Life by Brian Andrew of Cleary Gull

Last Thursday, General Electric announced that they were selling a $26 billion real estate portfolio and substantially reducing the size of their financing arm, GE Capital. This announcement has a number of broader implications beyond GE’s own company and stock price. It may be an indication of what large multi-national companies must do at this point in the market cycle to show earnings growth.

2015-04-21 00:00:00 The Charge Of The Monetary Light Brigade - Neosho Capital On The European Central Bank And Negative by Chris Richey of Neosho Capital

A paper on European Monetary Easing, which we feel is a well-meaning, but misguided effort, to solve demographic, cultural, and political problems with massive monetary manipulations of exchange rates and securities markets.

2015-04-21 00:00:00 GE's Restructuring Pleases Investors and Avoids Other Risks by John Browne of Euro Pacific Capital

On April 10, General Electric, which for 123 years has been one of America's best known and most highly respected companies, announced a radical return to its basic industrial roots. After years of disappointing share performance, and a campaign of criticism by frustrated investors, Chief Executive Jeff Immelt decided to spin off most of its $500 billion GE Capital arm which, if taken as a stand-alone company, would have been the seventh largest bank in the U.S.

2015-04-21 00:00:00 Has The US Dollar Topped Out, Or Headed Much Higher? by Gary D. Halbert of Halbert Wealth Management

The US dollar’s value has been on a tear since last summer, with the greenback’s value surging more than 20% against a basket of major foreign currencies.

2015-04-20 00:00:00 Alternative Investing: Why Manager Skill is Crucial to Results by Walter Davis of Invesco

A key attribute of alternative investments is that alternative managers are typically given considerable freedom in how they invest. This freedom means that manager selection, an important consideration for all investors, becomes particularly crucial when investing in alternatives.

2015-04-20 00:00:00 Is Brazil The Next BRIC To Ride EM Equity Wave? by Team of GaveKal Capital

On an equal-weighted, USD basis, Russia is up 46% year-to-date, by far the best performing country in the MSCI All-Country World Index. Coming in second, is China which is up 29%. India is the 14th best performing country (8.2%). The lone man out is Brazil which is the fifth WORST performing country year-to-date, one of only 10 countries posting a negative return year-to-date (-7%).

2015-04-20 00:00:00 Afraid of Rising Rates? Don’t Be. by Ashish Shah and Ivan Rudolph-Shabinsky of AllianceBernstein

Sometime this year, the Federal Reserve will probably raise interest rates for the first time in more than half a decade. That makes bond investors nervous. But it shouldn’t. Those who keep their cool may find that higher rates can work to their advantage.

2015-04-20 00:00:00 Pockets of Value in the Stock Market by Russ Koesterich of BlackRock

Given the headwinds facing U.S. stocks, investors may want to consider tilting their stock portfolios toward these sectors and geographies offering relative value.

2015-04-20 00:00:00 On My Radar: The Speech at Lost Tree Club by Steve Blumenthal of CMG Capital Management Group

You and I are in a tough business. It is based on probabilities and involves imperfection. The mismatch between customer expectations and practical reality is challenging. Art Cashin said, That to survive 50 years in this business, you learn that the first thing you do when you enter a room is look for the exit sign. It is with this thinking that I also share a great piece on investing and risk from Ned Davis.

2015-04-20 00:00:00 Market Rules to Remember by Mark Ungewitter of Charter Trust Company

A few years ago, I participated in a panel discussion at the 50th Annual Contrary Opinion Forum in Vermont. One of my fellow panelists, Walter Deemer of Deemer Technical Research Inc., has been a cornerstone of institutional market strategy since the early 1960’s and is this year’s recipient of the MTA’s prestigious annual award.

2015-04-20 00:00:00 Picking Stocks in the Tech Sector by Chaitanya Yaramada of Robert W. Baird & Co.

Technology is an important sector for growth portfolios - it carries a significant weight in major growth benchmarks, and more importantly, tends to be a ripe area for stock picking. The technology sector represents nearly 15% of the Russell Midcap Growth benchmark and 24% of the Russell 3000 Growth benchmark. The percentage is even higher when including Internet stocks that are categorized into the Consumer Discretionary sector.

2015-04-20 00:00:00 Drags on the Economy and Earnings Should Slowly Fade by Robert Doll of Nuveen Asset Management

Investors focused on the negatives last week, including some disappointing U.S. economic data and growing concerns over what will happen with Greece’s debt problems.

2015-04-20 00:00:00 Emerging Europe: Economy Trends Update – April 2015 by Team of Thomas White International

With the exception of energy exporter Russia, economic conditions appear to have taken a turn for the better in emerging Europe.

2015-04-20 00:00:00 Thoughts from the Frontline: Half a Bubble Off Dead Center by John Mauldin of Mauldin Economics

Central banks, in their valiant, unceasing efforts to restore liquidity and growth, have unleashed numerous unintended consequences that are beginning to show up in earnest. Today we are going to review the well-meaning behavior of central banks for clues about our near future.

2015-04-19 00:00:00 US Equity And Economic Review For the Week of April 13-17; False Break-Out Edition by Hale Stewart of Hale Stewart

After consolidating since the beginning of March, it appeared that SPYs broke out on Wednesday. It was a false break-out. Wednesday’s daily candle was weak, with a small body and high shadow. Rather than continuing the move higher, Thursday printed a similar candle. The markets gapped lower on Friday, sending the daily chart back into its previous consolidation pattern. Several weak economic numbers contributed to the markets sell-off, including industrial production, further weakness in retail sales and increasing negativity in the LEIs components.

2015-04-19 00:00:00 Weighing the Week Ahead: A Geopolitical Risk to U.S. Stocks? by Jeff Miller of New Arc Investments

I expect the supposed worries of Friday to prove unwarranted – an idea supported by late-day Friday trading. The real focus will quickly turn to earnings and housing data.

2015-04-18 00:00:00 Today's NFP Miss Means Little For Equities and The Economy by Urban Carmel of The Fat Pitch

Failed sell offs lead to failed rallies. This has been the recurrent pattern for the past four months. There is unlikely to be a sustained move higher until there is a more complete sell off lower. Risk remains to the downside.

2015-04-17 00:00:00 The Labor Market Recovery’s Missing Ingredient by Russ Koesterich of BlackRock

Why are so few Americans participating in the labor market even as jobs become more plentiful? Russ explains, noting two implications for investors.

2015-04-17 00:00:00 Hoisington Quarterly Review and Outlook – First Quarter 2015 by Lacy Hunt and Van Hoisington of Hoisington Investment Management

Over the more than two thousand years of economic history, a clear record emerges regarding the relationship between the level of indebtedness of a nation and its resultant pace of economic activity. The once flourishing and powerful Mesopotamian, Roman and Bourbon dynasties, as well as the British empire, ultimately lost their great economic vigor due to the inability to prosper under crushing debt levels.

2015-04-17 00:00:00 Irrational Expectations by Andy Rothman of Matthews Asia

Do we have irrational expectations for the Chinese economy? On the one hand, we asked China to restructure and rebalance its economy, and it has delivered. It shrunk its state sector, and privately owned firms now account for more than 80% of employment and almost all new job creation. Almost all prices are set by the market. Investment growth is slowing and consumption is now the engine of economic expansion. China’s service sector is now larger than its manufacturing and construction sectors.

2015-04-17 00:00:00 Who will get caught skinny-dipping? by Edward Perkin of Eaton Vance

More than six years into a bull market for all major asset classes, are there any true investment bargains left?

2015-04-17 00:00:00 Are Commodities And EM Stocks Becoming Less Sensitive To The Dollar? by Team of GaveKal Capital

Are commodities becoming less sensitive to changes in the USD? The surge in the dollar has negatively affected commodities somewhat but not nearly as much as one might have expected given that the real trade-weighted dollar is 19% higher than it was in July. Commodities are about 19% lower during this time. However, when the dollar surged by 14% in 2008, commodities fell by 39%.

2015-04-17 00:00:00 Key Themes for Navigating Credit Markets in Alternatives Strategies by Joshua Anderson of PIMCO

Against a backdrop of low volatility and tight spreads, 2014 turned out to be a challenging year for many alternative investors as they watched their trades become crowded, and reverse quickly when expected returns were not realized. One such example was the positioning among investors in advance of the European Central Bank’s (ECB) Asset Quality Review announcement; many had increased their exposure in anticipation of a tightening of European bank-related securities.

2015-04-17 00:00:00 Greek Drama Extends Its Run by David Zahn of Franklin Templeton Investments

Greece’s debt problems have retaken center stage, as payment deadlines approach and negotiations with creditors continue. The money-strapped country and Syriza, its radical left-wing ruling party, are back in the headlines and on the minds of investors, as predictions that Greece could leave the eurozone abound. David Zahn, head of European Fixed Income, Franklin Templeton Fixed Income Group®, offers his perspective on Greece’s dramatic debt saga, as well as the orderly beginning of the European Central Bank’s quantitative easing program.

2015-04-17 00:00:00 Sharpen Your Pencils: Why Low Rates Challenge Traditional Security Analysis Methods by Edward Talisse of Chelsea Global Advisors

Now that we are dealing with near-zero, and in certain instances, negative short-term interest rates, is it worth retaining the highly cherished Sharpe Ratio as a tool of investment performance? Measuring and ranking the intersection of risk and reward is a foundational principle of investment management, first introduced by Noble Laureate William F. Sharpe back in 1966.

2015-04-17 00:00:00 Junior Mining Companies Have Taken a Senior Role by Frank Holmes of U.S. Global Investors

For the past decade, junior mining companies have outperformed senior miners at finding new mineral deposits and generating wealth for investors.

2015-04-17 00:00:00 Mr. Valuation Disagrees with Henry Blodget: "It's a Market of Stocks" is not a Meaningless Phrase by Chuck Carnevale of FAST Graphs

The meaningful phrase “it’s a market of stocks, not a stock market” stands as a continuous reminder to me to focus on what’s important while ignoring what’s not. Since I do not invest in the entire market, I spend no time worrying about it. Instead, I spent all my time and effort evaluating the specific investments that I am actually invested in.

2015-04-17 00:00:00 Weekly Economic Commentary: Countries Can’t Devalue Their Way to Prosperity by Carl Tannenbaum of Northern Trust

Countries Can't Devalue Their Way to Prosperity; Central Banks Are Doing Some Interesting Rebalancing; Paying for the Energy Dividend

2015-04-17 00:00:00 Two Job Markets by Rob Isbitts of Sungarden Investment Research

We have written in the past about U-6, which in addition to being a very large shrimp (it’s a code that means 6 shrimp to a pound), is one of the government’s measures of unemployment. Specifically, it includes not only the traditional definition of unemployed (which the government calls U-3) but also those who are working but “under-employed." These may be people who are working multiple jobs, taking jobs that are below their level of experience, or those who have been unemployed for a long time. None of these people are included in the “headline” employment figures you hear about o

2015-04-16 00:00:00 REIT CEFs by (Article)

Closed-end funds focusing on Real Estate Investment Trusts (REITS) offer potentially attractive exposure to a huge asset class, says Mark McAllister of ClearBridge Investments.

2015-04-16 00:00:00 Q1 Review by (Article)

Closed-end funds got off to a strong start in Q1 2015 and senior loan funds reversed a trend, says Mike Taggart of Nuveen Investments.

2015-04-16 00:00:00 Global Business Cycle Deceleration and US Conundrum by Alexander Giryavets of Dynamika Capital L.L.C.

The Global Business Cycle is decelerating while the regional Asian and European Subcycles are recovering. This poses the US between a hammer and a hard place as it gets hurt by each single one of them. Will it get crushed or stand strong in this global interplay?

2015-04-16 00:00:00 Three Portfolio Moves to Consider Now by Russ Koesterich of BlackRock

While the first quarter largely played to script, there were a few surprises. Russ explains, noting three portfolio moves to consider as the second quarter kicks off.

2015-04-16 00:00:00 Stock Market Boom and Crash: Cause and Effect by Wim Grommen of Transfer Solutions

This article explains, based on transition properties, why a stock market boom occurs during the acceleration phase of a transition, inevitably followed by a stock market crash in the stabilization phase of a transition.

2015-04-16 00:00:00 A New Way Forward for Nigeria? by Mark Mobius of Franklin Templeton

Perhaps the biggest long-term challenge for Nigeria going forward is to develop government leadership that will be intent on economic development and utilizing the country’s resources to develop infrastructure.

2015-04-16 00:00:00 Can The Marriage of Two Knowledge Followers Produce a Knowledge Leader? by Team of GaveKal Capital

Most of our readers are familiar with our process that seeks to identify what we refer to as Knowledge Leaders or, quite simply, companies that consistently invest in knowledge-intensive activities such as research & development, advertising, and employee training. Common attributes of knowledge leaders include, but are not limited to, less volatile earnings and sales growth, lower adjusted ROE, and a larger stock of intangible capital on their balance sheets.

2015-04-16 00:00:00 Finding Value in Declining Commodity Prices by Frank Holmes of U.S. Global Investors

I’m going to begin with a bit of good news. Below is our China Region Fund (USCOX). As you can see, not only has it broken above its 50- and 200-day moving averages, but it’s also trading at four-year highs. And since this chart was created early last week, the fund has climbed even higher, to $9.53 as of this writing.

2015-04-16 00:00:00 Counting on Cash in Cloudy Equity Markets by David Dalgas of AllianceBernstein

Equity markets are digesting mixed signals in early 2015, from the divergence of monetary policies, shifting economic growth patterns and currency volatility. Instead of worrying about deciphering these trends, we think investors should focus on individual company cash flows in order to identify companies with strong long-term return potential.

2015-04-16 00:00:00 Implications of a Fed Funds Rate Hike on Asian Securities by Gerald Hwang of Matthews Asia

The prospect of a higher U.S. federal funds rate can make U.S. cash and short duration Treasurys look more attractive vs. risky assets. The effect of higher U.S. short rates is felt across all asset classes, regardless of the pattern of cash flows or currency of denomination. We can expect some market reallocation out of risky assets and into risk-free assets. But why does the market seem to fear a wholesale shift out of risky assets and why might that view be unjustified? In the second installment of a two-part series, Matthews Asia Portfolio Manager Gerald Hwang, CFA, examines the ways in wh

2015-04-16 00:00:00 The Unexpected Ripple Effect of New Bank Capital Requirements by Libby Cantrill, William G. De Leon, Tracey Jordal, Courtney A. Walker of PIMCO

In the aftermath of the 2008 financial crisis, lawmakers and regulators promulgated sweeping regulations that sought to reduce systemic risk and promote market stability.

2015-04-16 00:00:00 Gauging Global Growth: An Update For 2015 & 2016 by John Canally of LPL Financial

Global growth is likely to be a recurring theme for investors this week. The health of the global economy and key regions (U.S., Eurozone, Japan, China, etc.) is likely to get plenty of attention from corporate managements as they discuss Q1 2015 results and provide guidance for the rest of the year. In addition, the International Monetary Fund (IMF) will release the spring 2015 edition of its widely read World Economic Outlook on Tuesday, April 14, 2015, and China will release its Q1 2015 gross domestic product (GDP) that same day.

2015-04-16 00:00:00 1Q 2015 Newsletter: Eliminating the Confusion about Active Equity Management by William Smead of Smead Capital Management

There are a great number of bright mathematicians out there who can explain almost everything in common stock selection and portfolio management. One well-known student of the arena is Michael Mauboussin, a Managing Director at Credit Suisse, who recently published a challenging piece of research seeking to explain how difficult it was last year (2014) for mutual funds to beat the S&P 500 Index. In reviewing his analysis, we are reminded that calling stock picking and portfolio management “active management” has done the investment marketplace a huge disservice.

2015-04-15 00:00:00 Market Overview Q115 by David Robertson of Arete Asset Management

One consequence of loose monetary policy and financial repression is that market participants stop “making judgments for themselves” which exacerbates procyclical behavior. At the same time, high levels of debt weaken the ability of the economic and financial systems to absorb shocks which creates a fragile situation. Although this environment is difficult for almost all investors, it will favor those who can think and act independently.

2015-04-15 00:00:00 Emerging Markets of Tomorrow by Jeremy Schwartz of WisdomTree

This week Professor Siegel and Jeremy Schwartz chatted with Gavin Serkin, Emerging Markets (EM) Editor at Bloomberg News. They also spoke to Worth Wray, Chief Strategist at Mauldin Economics, whose current focus is also on EM and the implications of a stronger U.S. dollar.

2015-04-15 00:00:00 Bank Loans Are the Tortoise, Not the Hare by Cheryl Stober of Loomis Sayles

The global financial crisis did not change the nature of bank loans. Bank loans were specifically designed by bankers to resist the forces that drive volatility in most other asset classes. Bankers designed bank loans to reduce the volatility that comes along with changes in interest rates and company values, so they insisted that loans have floating coupons and that they be senior and secured.

2015-04-15 00:00:00 China Finally Stops Fighting the Stock Market by Peter Schiff of Euro Pacific Capital

Although China's economy has been leading the world in annualized growth since the days that mobile phones had retractable antennas, there have always been some aspects of the country's commercial and financial system that loudly broadcast the underlying illogic of a Communist Party's firm control of burgeoning capitalism. China's stock markets were one such venue where things just didn't add up...literally.

2015-04-15 00:00:00 Despite Volatility, Global Economy Looks Stronger by Hank Herrmann of Ivy Investment Management Company

So far this year, the financial markets have given us a volatile ride. But it’s a ride that has left us just about where we started. It’s not exactly that nothing happened, of course, but the S&P 500 Index ended the first quarter essentially flat. The volatility stems largely from two things: since January we’ve seen a steep decline in energy prices and a sharp rally in the dollar.

2015-04-15 00:00:00 The Long-Term Outlook: Secular Stagnation or Not? by Scott Brown of Raymond James

The good news is that the output gap, the difference between real Gross Domestic Product and its potential, has narrowed. The bad news is that’s largely because potential GDP has declined. The big question now is whether the economy is on a permanently lower track. The answer is not so clear.

2015-04-15 00:00:00 Managing Risk by Jeffery Saut of Raymond James

Most people acknowledge that losses will happen regardless of the type of business venture. A light bulb manufacturer knows that two out of three hundred bulbs will break. A fruit dealer knows that two out of one hundred apples will rot. Losses per se don’t bother them; unexpected losses and losing on balance does. Acknowledging that losses are part of business is one thing; taking and accepting those losses in the markets is something else entirely. In the markets, people tend to have difficulty actively taking losses. This is because all losses are treated as failure; in every other area o

2015-04-14 00:00:00 Gundlach - The Bond Market is at a Pivotal Point by Robert Huebscher (Article)

Jeffrey Gundlach turned defensive on the U.S. bond market at the end of January, almost precisely when yields were at their lowest point. Whether his outlook changes hinges on the direction of the 30-year bond and if it retests its low yield of 2.45%.

2015-04-14 00:00:00 Ukraine: Mass Corporate Debt Restructuring Looks Likely by Sponsored Content from Invesco (Article)

Ukraine's biggest economic problem is its deep recession. We expect gross domestic product to contract by about 7% this year, as the conflict with Russia has devastated Ukraine's vital industrial corridor in the east, interest rates and inflation are soaring, and its currency teeters on collapse.

2015-04-14 00:00:00 New Research: Reverse Mortgages, SPIAs and Retirement Income by Joe Tomlinson (Article)

Retirees need longevity protection and additional funds. Annuities and reverse mortgages can meet those needs. While annuities have been researched extensively, reverse mortgages haven't received as much attention. We need research on how to fit these two products together in overall retirement plans. I'll launch that effort here.

2015-04-14 00:00:00 The Key to Attracting New Clients: Be Less Available by Dan Richards (Article)

Whether in booking appointments with prospects, getting key clients to come to events or winning over referrals, communicating a sense of limited supply helps you achieve your goals.

2015-04-14 00:00:00 Stock Market Returns - The GDP Growth Rate Myth by Baijnath Ramraika, CFA® (Article)

The idea that nominal equity market returns approximate the country's GDP growth rate is historically uninformed and intellectually dishonest. If there were any merit to the idea that equity market returns should approximate GDP growth rate, we would see this in a tight relationship between the two variables across countries. But we don't.

2015-04-14 00:00:00 Why Women Advisors are Judged Differently by Daniel Solin (Article)

Are women advisors perceived differently than their male counterparts? If so, what can we do about it?

2015-04-14 00:00:00 The Words to Avoid in Marketing Your Firm by Beverly Flaxington (Article)

Are there key phrases and terms we should stay away from in our firm's marketing message?

2015-04-14 00:00:00 Tocqueville Gold Strategy Investor Letter by John Hathaway of Tocqueville Asset Management

John Hathaway, manager of the Tocqueville Gold Fund (TGLDX), looks back at the performance of gold over the first quarter, noting that "Gold and gold mining shares appear to be as contrarian today as in 1999, before a decade?plus run in which bullion rose nearly seven?fold in US dollar terms."

2015-04-14 00:00:00 Not-So-Great Expectations: Why Real Interest Rates Won’t Soar by Shane Shepherd of Research Affiliates

In a recent piece from Research Affiliates, Shane Shepherd, Senior Vice President, Head of Macro Research, looks at the consensus on interest rates: they are set to fly. But if, as Research Affiliates expects, savings accelerate and real GDP grows slowly, then interest rates won’t rise very much anytime soon.

2015-04-14 00:00:00 Expect Further Divergence in Emerging Market Economies by Michael Gomez, Lupin Rahman of PIMCO

Each quarter, PIMCO investment professionals from around the world gather in Newport Beach to discuss the firm’s outlook for the global economy and financial markets. In the following interview, portfolio managers Michael Gomez and Lupin Rahman discuss PIMCO’s cyclical outlook for the emerging markets (EM).

2015-04-14 00:00:00 U.S. Labor: A Not-So-Great Participation Rate by Milton Ezrati of Lord Abbett

The percentage of Americans either working or looking for work is lower than pre-recession levels. Here’s what it could mean for the economy—and Fed policy.

2015-04-14 00:00:00 The Case for Not Currency Hedging Foreign Equity Investments: A U.S. Investor’s Perspective by Catherine LeGraw of GMO

In a new white paper, Catherine LeGraw of GMO's asset allocation team explains GMO's approach to currency hedging, a topic which has gained relevance as the U.S. dollar has strengthened.

2015-04-14 00:00:00 Bear Market Hibernation End is Nearing by Sean Butson of DC Capital Management

The S&P 500 continues to be overvalued and has become more so over the last 6 months. Based on 7 different valuation metrics, future 10 year compound annual returns are likely to be only about 6% vs. 9%-10% historically. While we are not expecting an imminent bear market, the specter of FED rate increases likely does indicate the beginning of the end of the current bull, as 12 out of 14 S&P 500 declines of at least 15% over the last 60 years have occurred within 3 years of FED tightening.

2015-04-14 00:00:00 China: New Year, New Opportunity? by Burt White of LPL Financial

China will release its first quarter 2015 gross domestic product (GDP) report this week on April 14, 2015, with the market expecting a 7% year-over-year increase. Regardless of whether China hits that target, its stock market has already been positive so far this year. In this year of the goat in 2015, global investors have not been sheepish about buying Chinese stocks, powering the Shanghai Composite 25% higher so far in 2015 amid prospects for more monetary stimulus and policy reforms.

2015-04-14 00:00:00 Where's the Remote? by Jerry Wagner of Flexible Plan Investments

The panic would set in as soon as Dad would bellow “Where’s the clicker?” Everyone had to move. Cushions on chairs and sofas would be quickly tossed aside. Hands would stretch and scramble among the stale crumbs in the creases underneath in search of the elusive foe. Failure was not an option. There would be no TV that night until Dad’s hands grasp the clicker once more.

2015-04-14 00:00:00 The Active/Passive Debate: Others Weigh In by Roger Nusbaum of AdvisorShares

In the most recent AdvisorShares Alpha Call Josh Brown and Michael Batnick from Ritholtz Wealth Management discussed at length the importance finding the right strategy and then taking the time to understand the strengths and weaknesses of whatever you decide is the right strategy.

2015-04-14 00:00:00 The Iran Framework by Bill O'Grady of Confluence Investment Management

On April 2, the P5+1 and Iran announced a framework to deal with Iran’s nuclear program. The framework is a roadmap to establishing a final agreement in June and could be a major step toward delaying Iran’s entry into the “nuclear club.” This report begins with a short history of Iran’s nuclear program. Next, we review the details of the framework and address the broader policy issues surrounding Iran’s nuclear program. An analysis of the real issue, regional hegemony, follows along with a review of the political factors of the deal. We conclude with the potential market effects.

2015-04-14 00:00:00 Stocks: The Great Wealth Non-Equalizer by Lance Roberts of Streettalk Live

Just recently, IBD.com published a very interesting article entitle "Stock Market Is America's Great Wealth Equalizer." While I am sure the author is well-intentioned, it is a very misguided article in its assumptions.

2015-04-14 00:00:00 Waiting for the Right Pitch by John Loesch, CFA of Diamond Hill Capital Management, Inc.

Patience is a virtue, both in life and in investing. As a long-term investor in a short-term focused world (and a father of three young children), I know that remaining patient is not always easy. At Diamond Hill, we keep the advice of both Warren Buffett and legendary hitter Ted Williams in mind and try to wait for the “right pitch.”

2015-04-14 00:00:00 Yield Curve Flattening and Volatility LIkely to Continue in 2015 by Payson Swaffield of Eaton Vance

In the first quarter of 2015, we continued to see a trend toward a flatter yield curve, shaped by rising rates at the short end and a relatively tethered long end, against the backdrop of higher volatility.

2015-04-14 00:00:00 Second Quarter Market Commentary 2015 by The CCR Wealth Management Investment Committee of CCR Wealth Management

Over a year ago in our January 2014 Outlook commentary, we cited European markets as attractively priced relative to the US equity markets. Most market observers at the time were expecting a nascent recovery from the 2012 EU recession to get a boost from the European Central Bank (ECB). We even boosted our non-US developed market (and European-specific) allocation—though cautiously—in anticipation. Please note that we still think these markets are most attractively valued.

2015-04-13 00:00:00 Liquid Alternative Strategies as Mutual Funds by Michael Winchell of Larkin Point Investment Advisors LLC

The recent growth of mutual funds offering a wide array of liquid alternative strategies has raised questions among many advisors about the possible drawbacks of attempting alternative strategies within a 1940 Act vehicle.

2015-04-13 00:00:00 Asia’s Multilateralism by Joseph Stiglitz of Project Syndicate

In March, the United Kingdom, Germany, France, and Italy joined more than 30 other countries as founding members of the new Asian Infrastructure Investment Bank, which will do what existing institutional arrangements cannot: help Asia meet its massive infrastructure needs. So why has the US sought to undermine the effort?

2015-04-13 00:00:00 Top 10 Considerations for June to September Liftoff by Bradley Krom of WisdomTree

One of the top stories of 2015 so far has been the anticipated liftoff from the zero bound interest rate target of the U.S. Federal Reserve (Fed). As market forecasters continue to debate June vs. September, we share some observations from previous hiking cycles to guide your views.

2015-04-13 00:00:00 On My Radar: High Valuations = Low Forward Returns by Steve Blumenthal of CMG Capital Management Group

“I can’t change the direction of the wind, but I can adjust my sails to always reach my destination. – Jimmy Dean”

2015-04-13 00:00:00 Global Economic Risks Remain but Appear to Be Diminishing by Robert Doll of Nuveen Asset Management

Investors reacted to a range of data and news last week that included a further digesting of the relatively weak March jobs data, ongoing merger and acquisition news, signs of weakening corporate earnings and further evidence of upward pressure on wages. Amid all of the crosscurrents, U.S. equities finished higher, with the S&P 500 Index gaining 1.7%.1 Most international markets advanced as well, while Treasury yields and the U.S. dollar rose.1 Industrials, health care and energy stocks led the way while telecommunications, utilities and financials lagged.

2015-04-13 00:00:00 How Much Lower Can The 30-Year Treasury Yield Go? by Team of GaveKal Capital

Three weeks ago we mentioned how Fed assets were finally declining on a quarterly basis. Since then we have had a few more data points released and the trend is still downward. Compared to three months ago, the Fed's balance sheet has shrunk by over $32 billion. We are, however, beginning to reach the contractionary limit during the QE period. The most the Fed's balance sheet has contracted over a three month period was $81.8 billion in May 2012.

2015-04-13 00:00:00 Quarterly Letter – April 2015 by Ron Muhlenkamp, Jeff Muhlenkamp of Muhlenkamp & Company, Inc.

Ron and Jeff Muhlenkamp discuss their views on the U.S. stock market, then briefly touch on some broader U.S. and global issues, then close with a summary of how it all ties together.

2015-04-13 00:00:00 June Rate Hike Still on Tap by Brian Wesbury, Robert Stein of First Trust Advisors

According to a recent survey by the Wall Street Journal, most economists think a June rate hike is unlikely. In fact, four times as many think the Federal Reserve won’t start raising rates until September or later as currently think the Fed will start in June.

2015-04-12 00:00:00 Are We Doomed to Weaker Growth by Hale Stewart of Hale Stewart

Any rally still faces strong headwinds. With a PE of 20.47, equities are already expensive. The strong dollar and weaker overseas economies are hampering general earnings growth while oil’s price drop is decimating the energy sector. And the percentage of NASDAQ and NYSE stocks about the 50 day EMA is approaching overbought levels. Without a meaningful change in either the earnings or valuation environment, any advance appears limited to at most 5%. That places a premium of stock picking and allocation.

2015-04-12 00:00:00 Weighing the Week Ahead: The Start of an Earnings Recession? by Jeff Miller of New Arc Investments

The year-over-year growth rate for forward earnings has once again turned positive. We can and should be on the watch for a true recession – the source of major earnings declines. The talk about an “earnings recession” should not be a source of worry.

2015-04-12 00:00:00 Weekly Market Summary by Urban Carmel of The Fat Pitch

US markets once again look set-up to continue higher, as they have multiple times in the past four months. Each time in the past, however, they have instead reversed lower. Equities may continue higher this week - they are not overbought - but it seems unlikely that the largely trend-less environment has ended once and for all. Sentiment and volatility suggest unfavorable risk/reward on a one-month timeframe.

2015-04-12 00:00:00 Valuation and Speculation: The Iron Laws by John Hussman of Hussman Funds

If you genuinely want to learn something from our experience during the recent half-cycle, it’s not to discard the Iron Law of Valuation, but to couple your awareness of valuation with an understanding of where investor preferences toward risk are from the standpoint of the Iron Law of Speculation. I had very vocal concerns about valuation during the tech bubble and the housing bubble, well before they burst.

2015-04-11 00:00:00 Finding Value in Declining Commodity Prices by Frank Holmes of U.S. Global Investors

So what’s the deal with Chinese equities right now? After all, China’s economic growth for the first quarter of the year cooled to a six-year low of 7 percent. The market surge is mostly attributable to monetary easing and government policy changes such as housing stimulus and modernization of the country’s financial structure. But there’s more at work.

2015-04-11 00:00:00 It’s the Weather…! by Scott Minerd of Guggenheim Partners

Investors anticipating first-quarter GDP growth should revisit the data—a replay of 2014’s weather-induced economic downturn is more likely.

2015-04-11 00:00:00 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Today’s Oil Retreat Is at Odds with Long-Term Trends; A New Bank Creates Controversy in Asia; Solving the U.S. Wage Conundrum

2015-04-11 00:00:00 Slip Sliding Sideways by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

Volatility will likely continue and more sideways action could be in store for the US equity market. We believe US economic data will start to rebound, helping push stocks higher in the second half of the year. The Fed remains in focus, but a rate hike is not likely until the latter half of 2015, which has helped slow the dollar’s upward momentum; potentially comforting the market and letting businesses better react. Better near-term opportunities may exist overseas as the Eurozone economy is improving and Japan seems poised to rebound from soft data.

2015-04-10 00:00:00 Combining Active and Passive: Three Issues to Consider for Risk-Averse Investors by Clint Harris of Invesco Blog

I was having a lively due diligence meeting with a retirement consultant the other day, discussing how our team manages Invesco Diversified Dividend Fund, and where we, as a conservative strategy, see opportunities and risks in the market today. Then came a moment of truth. The consultant sat back and said, “I really believe in what you all are doing, but many of my retirement plan committees just want passive index funds to bring down expenses.”

2015-04-10 00:00:00 An Open Letter to the Eurozone by Harley Bassman of PIMCO

As it has once again become fashionable to send an open letter to foreign dignitaries, now is certainly a propitious moment to help focus attention upon dissolving a perplexing financial impediment. For while limiting nuclear proliferation and reducing armed conflict are headline grabbers, the more mundane topic of cleansing the channels of global finance is in fact a public policy good that can create a positive social impact in real time. As such, I now respectfully offer my thoughts on ways to enhance the effectiveness of the current policy path.

2015-04-10 00:00:00 Words with Friends by John Canally of LPL Financial

Words matter. As investors brace for the unofficial start of the S&P 500 earnings reporting season for first quarter 2015 (see this week’s Weekly Market Commentary, “Earnings Recession?” April 6, 2015, for details), the financial media is swirling with words and phrases like “rig count,” “strong dollar,” “port strike,” and even “bad weather.”

2015-04-10 00:00:00 Using Options Strategies to Mitigate Volatility by George Hashbarger, Jr. of The BPV Family of Funds

The current bull market in U.S. stocks has now entered its seventh year and continues chugging along. In such a market environment, which has lacked a meaningful correction in either magnitude or duration, it’s easy to become complacent. However, the pull back last October and the choppiness markets experienced in December and January should serve as a reminder that the long period of low volatility has likely ended.

2015-04-10 00:00:00 Key Themes for Navigating Credit Markets in Alternatives Strategies by Joshua Anderson of PIMCO

??We believe the current investment environment provides extensive opportunities for alternative investors.

2015-04-10 00:00:00 China for Sale? by Robert Horrocks of Matthews Asia

In recent years, some China watchers have been wondering where the “smart money” is going? How telling are the real estate transactions of the region’s tycoons? And do concerns still exist over the growth in loans to the corporate sector? Matthews Asia’s CIO Robert Horrocks, PhD, explores.

2015-04-10 00:00:00 Favorable growth in European bond markets by Phil Apel (Article)

Phil Apel, Head of Fixed Income, reviews European current fixed income market trends and provides an outlook for the bond market throughout 2015. Apel reflects that during Q1, global bond markets were positively driven by the actions of the Federal Reserve and the European Central Bank (ECB) resulting in bonds yields generally falling, and good returns for government bond markets.

2015-04-10 00:00:00 Where Positive Economic Surprises Are (And Aren't) Happening by Team of GaveKal Capital

There is a geographic disparity amongst the Citi Economic Surprise Index. Economies, both developed and emerging, are surprising to the upside in Asia and Europe while economies in the western hemisphere are not doing as well (at least in terms of meeting and exceeding expectations). Below we show some of the more interesting charts.

2015-04-10 00:00:00 Buybacks Are Not Just an Accounting Trick by Joseph Paul of AllianceBernstein

As if on cue, news of record buyback authorizations earlier this year unleashed a torrent of media coverage denouncing them as nothing more than an accounting sleight of hand. We think the reaction has been pretty extreme.

2015-04-10 00:00:00 Reforms Help Revive Eurozone Recovery Hopes by Lisa Myers of Franklin Templeton Investments

Many of the eurozone’s local stock markets began 2015 with a bang, as the effects of the European Central Bank’s quantitative easing (QE) program were felt even before the bond-buying began. While QE seems to have provided a quick lift to many eurozone economies and and their respective equity markets, Lisa Myers, executive vice president, Templeton Global Equity Group™, stresses the importance of long-range structural reform in any sustained eurozone recovery. She analyzes country-specific endeavors and discusses their implications for future economic growth in the region.

2015-04-10 00:00:00 The Dollar and the Fed: A Love-Hate Relationship by Rick Harrell of Loomis Sayles

The US job market continues to plow ahead, leading many to believe Fed rate hikes are coming later this year. However, the pace of hikes may be slower than expected. The Fed is facing a “dollar dilemma” as it evaluates US economic outperformance.

2015-04-09 00:00:00 It’s Time to Make Taxes Less Taxing by Michael Allison, Peter Crowley, Jim Evans, Tom Metzold, Rey Santodomingo of Eaton Vance

Can a strategy based on asset allocation, asset location and asset management increase the tax efficiency of your portfolio?

2015-04-09 00:00:00 Supply-Side Yellenomics Is (Slowly) Losing Its Grip on Markets by Tony Crescenzi of PIMCO

Should investors worry about the possibility that the Federal Reserve might raise interest rates this year? How about the negative economic consequences of the rally in the U.S. dollar? “Hawkish” Fed mistakes?

2015-04-09 00:00:00 Bottom Fishing by Team of GaveKal Capital

I often go back and re-read things that have shaped my perspective on managing portfolios. In my 20s (in the 1990s) I was fortunate to have a friend and mentor named Clay Allen who taught me volumes on the art of portfolio management. He introduced me to the point and figure method of charting stock prices and we often talked at length about how to win the "losers game".

2015-04-09 00:00:00 When Will the Bull Market End? by Russ Koesterich of BlackRock

Russ explains why the stock market rally can continue, at least for another year.

2015-04-09 00:00:00 The PMC Spotlight: Quantitative Portfolios: Factor-Enhanced Series by (Article)

In this video, Brandon Thomas, Chief Investment Officer, underscores the unique features of the Quantitative Portfolios: Factor-Enhanced Series. In addition, Mr. Thomas provides background on the financial research supporting value and momentum factor style investing.

2015-04-08 00:00:00 The 'Perfect Storm' by Niels Jensen of Absolute Return Partners

This month's Absolute Return Letter is about the highly unusual set of circumstances which have underpinned the equity bull market of the last 35 years. Not one of the factors we identify did exceptionally well - they all did and, between them, they created the perfect breeding ground for exceptional equity performance. So far so good. Unfortunately a reality check is required as it is exceedingly unlikely that those circumstances will be repeated in our lifetime. We should prepare for more modest returns ahead.

2015-04-08 00:00:00 Equity Cyclical Outlook: Between Fed lift-off and living in the New Neutral by Virginie Maisonneuve, Mark Richards of PIMCO

Virginie Maisonneuve, PIMCO’s CIO Global Equities, and equity macroeconomic analyst Mark Richards provide an update on PIMCO’s views on equity markets.

2015-04-08 00:00:00 Runs in the Market Suggest Under-performance in 2015 by Ian Arvin of Innovative Quant Solutions

Based on our analysis of the number of consecutive days the market moves in one direction, or “runs”, 2015 is currently pointing to either a down year or a below average return.

2015-04-08 00:00:00 Creative Self-Disruption by Mohamed El-Erian of Project Syndicate

Companies like Uber, Apple, and Airbnb have succeeded by exploiting a fundamental trend affecting nearly all industries: individual empowerment through the Internet, app technology, digitalization, and social media. If traditional firms hope to remain competitive, they must follow suit.

2015-04-08 00:00:00 Earnings Recession? by Burt White of LPL Financial

Earnings season kicks off this week (April 6?–?10) with Alcoa set to report first quarter 2015 earnings on Wednesday, April 8. This earnings season has received a great deal of attention in recent weeks because it may produce the first year-over-year decline in S&P 500 operating earnings since the tail end of the financial crisis during the third quarter of 2009. We preview earnings season and highlight reasons not to fear a potential decline.

2015-04-08 00:00:00 Valuation Normal for Mid-Cycle Period by Richard Bernstein of Richard Bernstein Advisors

While not as headline-catching as some of the doom and gloom market predictions currently circulating, our indicators suggest that the equity markets are fairly valued and are in the midst of a mid-cycle environment.

2015-04-08 00:00:00 The Misunderstanding Of El-Erian's Cash Position by Lance Roberts of Streettalk Live

In a recent interview with Mohamed El-Erian, former CEO of PIMCO Investments, a most interesting question was posed.

2015-04-08 00:00:00 Why The US Unemployment Rate May Be Wrong by Gary Halbert of Halbert Wealth Management

Last Friday’s unemployment report for March was a stunner, no doubt about it. After 12 consecutive months of new job creation above 200,000 per month, the Labor Department reported that only a meager 126,000 new jobs were created in March.

2015-04-08 00:00:00 Policy Paranoia by Robert Stimpson of Oak Associates

The present version of policy paranoia encompasses concerns over impending interest rate hikes, the rapid appreciation of the US dollar, a bloated US government balance sheet, weak international economies and increased probability of a crisis in certain Latin American countries. While legitimate, we do not believe the current ghosts are any more imminently destructive today than over the past six years.

2015-04-08 00:00:00 Economists in Glass Houses by John Mauldin of Mauldin Economics

For many economists, the chicken and egg question is, which came first, consumption or production? What drives growth? Let’s continue with our series on debt, in which I have been contrasting my views with those of Paul Krugman.

2015-04-08 00:00:00 U.S. and Canada: Continued Recovery With Some Potential for Headwinds by Ed Devlin, Mike Cudzil of PIMCO

?Each quarter, PIMCO investment professionals from around the world gather in Newport Beach to discuss the firm’s outlook for the global economy and financial markets. In the following interview, portfolio managers Ed Devlin and Mike Cudzil discuss PIMCO’s cyclical outlook for Canada and the U.S..

2015-04-08 00:00:00 Will a Weak Jobs Report and Poor Productivity Give the Fed Pause? by Jeremy Schwartz, of WisdomTree

Last Friday, Professor Jeremy Siegel and Jeremy Schwartz sat down with Sam Chandan, founder and chief economist at Chandan Economics, to discuss the unexpectedly weak jobs report, productivity, low interest rates and implications for the housing market.

2015-04-08 00:00:00 Dalbar: Why Investors Suck And Tips For Advisors by Lance Roberts of Streettalk Live

Dalbar just recently released their 21st annual Quantitative Analysis Of Investor Behavior study which continues to show just how poorly investors perform relative to market benchmarks over time and the reasons for that underperformance.

2015-04-08 00:00:00 Barron's Recap by Roger Nusbaum of AdvisorShares

2015-04-07 00:00:00 An In-Depth Look at the MFS Value Fund by Larry Swedroe (Article)

As I continue with my series analyzing the performance of some of the most successful actively managed mutual funds, it's important to acknowledge that I possess the benefit of hindsight; I am selecting funds I know have done well in the past. The question I seek to answer is whether investors should expect that outperformance to continue. With that in mind, today we'll take an in-depth look at the MFS Value Fund (MEIAX).

2015-04-07 00:00:00 Behind Arnott's Strategy for PIMCO's All Asset Funds by John Coumarianos (Article)

If you thought a stretch of subpar performance would shake a fund manager's confidence, you'd be wrong in the case of Rob Arnott. Through Research Affiliates, his Newport Beach firm most famous for its fundamental indexing strategies, Arnott manages PIMCO's All Asset funds. These include PIMCO All Asset (PAAIX) and PIMCO All Asset All Authority (PAUIX).

2015-04-07 00:00:00 A Q1 Letter to Clients: Ben Bernanke on Interest Rates by Dan Richards (Article)

Every quarter since 2008, I have posted a template for a client letter. This letter can be used as a starting point to provide an overview of the period that just ended and thoughts looking forward. This quarter's letter addresses questions from clients about why interest rates are so low and when they are likely to rise.

2015-04-07 00:00:00 Another Day, Another Breach by Steven J. Ryder (Article)

With an estimated 82,000 variations of viruses and malware released every day by hackers, how can you keep your client data secure? There is no room for complacency when it comes to the security of your client data, yet it is easy to become apathetic when nearly every day another cybersecurity breach is reported. Here are a few guidelines to protect your network.

2015-04-07 00:00:00 How to Defend Your Fees by Beverly Flaxington (Article)

There must be a way to more effectively illustrate the value we provide for the fees our clients pay. How have other advisors done this?

2015-04-07 00:00:00 Bullseye: Abe and the Japanese Equity Market by Pamela Rosenau of HighTower Advisors

Earlier this year, I articulated my thesis in this publication discussing how the developed markets would outperform the developing markets for the foreseeable future. I have grown to believe that Japan is in the nascent stage of a massive multiyear bull run – the likes we haven’t seen since the US market climbed from the painful declines of 2008-2009.

2015-04-07 00:00:00 Tracking the Market with Social Media by Blair Jensen of Trade Followers

Over the past week the market worked off the overbought condition created in the Trade Followers momentum indicator calculated from the Twitter stream for the S&P 500 index (SPX). The daily prints have been mostly positive even though the market was declining. This indicates market participants on Twitter believe that healthy consolidation is occurring rather than the start of a new down trend. 7 day momentum continues to hold its up trend line which confirms the move higher out of the January lows as well.

2015-04-07 00:00:00 Don't "Dread" The Plow Horse by Brian Wesbury, Robert Stein of First Trust Advisors

“Dread” is the perfect word for what many investors have felt in recent years. Some have experienced it daily since the bottom in March 2009. Some experience it whenever the stock market falls.

2015-04-07 00:00:00 Currencies Are a 2-Way Street by Jerry Wagner of Flexible Plan Investments

Humans are funny animals. There are many events, experiences, environments, and data points in the world shaping our perception. There is a psychological phenomenon called the recency effect, although it is known in the investment world as recency bias. Without delving into the psychological science as to why this happens, I think you will agree that most people tend to place a greater emphasis on more recent events.

2015-04-07 00:00:00 U.S. Economy: Getting the Jobs Recovery to Work Harder by Milton Ezrati of Lord Abbett

Even with the recent improvement, the pace of U.S. employment growth still lags earlier labor-market rebounds by a significant margin. What needs to be done to speed up the pace?

2015-04-07 00:00:00 Recession Probability Models - April 2015 by Ted Kavadas of StratX, LLC

There are a variety of economic models that are supposed to predict the probabilities of recession. While I don’t agree with the methodologies employed or probabilities of impending economic weakness as depicted by the following two models, I think the results of these models should be monitored.

2015-04-07 00:00:00 Margin Levels Look Safe Despite Tepid Economic Growth by Charlie Dreifus of The Royce Funds

Portfolio Manager Charlie Dreifus comments on the Fed's March statements and the first quarter's economic lull, discusses why dividend-paying stocks remain an attractive investment option, and makes a case for risk management in the current climate.

2015-04-07 00:00:00 The New World Order: Part IV by Bill O'Grady of Confluence Investment Management

The final installment of our series examines how, in light of winning the Cold War, policymakers have been unable to settle on a set of key priorities and offers glimpses of a new policy emerging. The US never wanted to be a superpower; its founding story is one of wresting independence away from a colonial power. Now that the existential threat of communism is over, the political class has struggled to create a foreign policy that can simultaneously provide the required hegemonic global public goods and create a working economic policy and political coalition that will build domestic harmony.

2015-04-07 00:00:00 How to Profit When Rates Rise: Negative Duration Bond Strategies by Bradley Krom of WisdomTree

As the debate rages surrounding the timing of the first Federal Reserve (Fed) rate hike, we continue to discuss the potential tradeoffs surrounding this inevitable shift in policy. While some investors may be content to ride out the waning bull market in bonds, others may seek to position more tactically.

2015-04-06 00:00:00 Dividend Value Investing: No Time for Suspension of Disbelief, Part 3 by Meggan Walsh of Invesco Blog

As previously explained in this series, investors who follow Hollywood’s lead and suspend disbelief may very well overlook the potential downside risk of a profit cycle in its later stages. But to avoid misunderstanding the market, it’s important to balance the concerns I’ve previously addressed in the first two parts of this series with supporting factors for the market.

2015-04-06 00:00:00 Weighing the Week Ahead: Correction Looming? by Jeff Miller of New Arc Investments

After a week loaded with economic data there are plenty of fresh economic worries. In addition, the Fed seems ready to act in spite of some weak data. This means that good news is (finally) good news, and bad news will be bad. For economic and market skeptics, it signals a market shift that they see as long overdue.

2015-04-06 00:00:00 Brobdingnagian Top? by Jeffrey Saut of Raymond James

According to Wikipedia, “Brobdingnag is a fictional land in Jonathan Swift's satirical novel about Gulliver's Travels whose land is occupied by giants. Lemuel Gulliver visits the land after the ship he is travelling on is blown off course and he is separated from a party exploring the unknown land.” I thought of Brobdingnag as I stared at a chart of the D-J Transportation Average ($TRAN/8605.31) last week, which looks like it is making what a technical analyst would term a giant broadening top, or in my terms a “Brobdingnagian Top?”

2015-04-06 00:00:00 March Employment Report – Fear vs. Hope by Scott Brown of Raymond James

The nonfarm payroll data for March were disappointing. Job growth was substantially less than expected and figures for the first two months of the year were revised lower. These data fit in with the general theme of other recent economic reports.

2015-04-06 00:00:00 Will China’s Infrastructure Bank Work? by Kenneth Rogoff of Project Syndicate

With China's creation of the new $50 billion Asian Infrastructure Investment Bank, most of the debate has centered on the futile US effort to discourage other advanced economies from joining. Bu the real question is why multilateral development lending has so often failed, and what might be done to make it work better.

2015-04-06 00:00:00 Improving Growth Should Eventually Push Equities Higher by Robert Doll of Nuveen Asset Management

On the heels of a somewhat rough first quarter, many investors are questioning the state of economic growth and wondering if equities still hold value. Our view is that an improving global economy should (eventually) allow for a renewed upturn in earnings prospects, and in equity markets. As such, we believe investors should remain patient.

2015-04-06 00:00:00 ISM Data for the First Quarter Point to Sluggish U.S. Economic Growth in Q1 by Robert Lamy of The Forecasting Advisor

The value of the coincident economic index for the first quarter is used to get a forecast of the rate of growth in U.S real GDP for the first quarter of 2015. The official advance estimate of real GDP growth for the first quarter of the 2015 will be released by the U.S. Bureau of Economic Analysis (BEA) on April 29th.

2015-04-06 00:00:00 Stock-Flow Accounting and the Coming $10 Trillion Loss in Paper Wealth by John Hussman of Hussman Funds

The failure to recognize that stock-flow consistency must hold in the economy and the financial markets is the basis for an enormous amount of misunderstanding in both fields. That omission of clear thinking about the link between economics and finance contributes to misguided policies that ignore the impact of financial distortions on the real economy, and invite speculation, malinvestment, and ultimately financial crisis.

2015-04-05 00:00:00 Weighing the Week Ahead: Correction Looming? by Jeff Miller of New Arc Investments

No one has a good, verifiable, real-time track record at predicting small corrections. Meanwhile, many investors get sidelined because they read an article or saw a chart suggesting that “the big one” was right ahead. Some people have been waiting for years for the correction so that they can get back in the stock market. Even when the correction finally comes they will be losers – and that assumes the ability to pull the trigger when things look bad!

2015-04-05 00:00:00 US Equity Market Review For the Week of March 30 - April 3; Economic News Weighing Negatively, Editi by Hale Stewart of Hale Stewart

True, the XLKs, XLIs and XLYs are consolidating at the top of a rally, implying the current price movement could simply be a pause before a move higher. But this would be occurring against a weakening economic backdrop, already expensive market valuations and declining corporate earnings. This makes a sustained move higher improbable unless the fundamentals change to a more bullish posture or earnings surprise to the upside.

2015-04-04 00:00:00 Lack Of Oxygen Causing a Feeding Frenzy? by Jerry of Flexible Plan Investments

Yesterday I awoke to a scene right out of a WWI or WWII aviation epic. The sky was filled with hundreds of flying objects, circling, swerving, and maneuvering for the best position. No human airport could possibly have dealt with the number of minute-by-minute, repeated takeoffs and landings, stretched in a panorama before me. Adding to the chaos, every few seconds one of the white-and-grey projectiles would crash into the lake with a vengeance.

2015-04-04 00:00:00 U.S. Economy: Are Consumers a Spent Force? by Milton Ezrati of Lord Abbett

Americans are saving more, while keeping consumption and borrowing in check. What does this signal for the broader economy?

2015-04-04 00:00:00 High-Yield Bonds: Equity-Like Returns Without Equity-Like Volatility by Michael Weilheimer, Steve Concannon, Will Reardon of Eaton Vance

Can an allocation to high-yield bonds help moderate the volatility in your portfolio without having to sacrifice return potential?

2015-04-04 00:00:00 On The Economy, The Environment & Income Tax Time by Gary Halbert of Halbert Wealth Management

The combination of topics for today’s E-Letter might seem unusual, and it is – the economy, the environment and income tax time. How do those fit together? They don’t really, but I think you will find today’s discussion on each to be interesting.

2015-04-04 00:00:00 Overview of the Fixed Income Market by Tim Gramatovich, Heather Rupp of AdvisorShares

As we look at the high yield bond market, it is important to have an understanding of the fixed income marketplace and the investment options within it. The first thing to note is the sheer size, which is massive (just under $40 trillion).1 Somewhat surprisingly, mortgages represent the second largest single subcategory of the bond market; this helps to explain why problems in the mortgage market nearly took down the entire financial system in 2008. The largest subcategory is U.S. Treasury debt.

2015-04-03 00:00:00 Less Than Zero: The Implications of Negative Interest Rates by Russ Koesterich of BlackRock Investment Management

Many bonds, mainly in Europe, are trading with a negative yield, meaning creditors are paying in order to lend money. Russ K explains, providing three implications for investors.

2015-04-03 00:00:00 Central Bank Dominance by Richard Michaud of New Frontier Advisors

The policies of the central banks are theoretically aligned in that they all have the objective of managing private economies with modern monetary macroeconomic principles. But, all four major economies are in different stages of recovery and disruptions are nearly inevitable. However, a positive view is that central banks are all focused on managing growth and that significant investment opportunities may be available for thoughtful investors and managers.

2015-04-03 00:00:00 ECRI Recession Watch: Weekly Update by Doug Short of Advisor Perspectives (dshort.com)

Friday's release of the publicly available data from the Economic Cycle Research Institute (ECRI) puts its Weekly Leading Index (WLI) at 132.6, up slightly from 131.5 the previous week. The WLI annualized growth indicator (WLIg) is at -2.5, up from the previous week's -3.3 and off its interim low of -4.9 in mid-January.

2015-04-03 00:00:00 Is a Lost Decade for Performance Coming? by Roger Nusbaum of AdvisorShares

Game plan the composition of your portfolio for the long term. There will be periods of generally good performance in the market (this will be most of the time) and the occasional declines (12-18 months is a normal duration) and a portfolio’s strategy and composition need to account for cycles and rotating performance leadership. No segment of the market can be the best for all times.

2015-04-03 00:00:00 Soft U.S. Employment Data: Not the End of a Trend by Carl Tannenbaum of Northern Trust

The headline numbers of the March employment report are disappointing against the backdrop of consistently strong reports for past several months. But putting things in perspective suggests that we have not completely forfeited the positive momentum in America’s labor market.

2015-04-03 00:00:00 The Four Questions by Rob Isbitts of Sungarden Investment Research

So with a nod to that annual Passover ritual, we present the financial markets’ current “Four Questions.” That is, why is this market different from all other markets?

2015-04-03 00:00:00 Today's NFP Miss Means Little For Equities and The Economy by Urban Carmel of The Fat Pitch

On it's own, today's weaker than expected NFP report is not necessarily a harbinger of bigger troubles ahead. The monthly NFP numbers are usually volatile. That we haven't seen any volatility in the past year perhaps made today's report surprising. The trend in employment is very strong; this is of far more importance than today’s miss.

2015-04-03 00:00:00 The Legend of Buybacks Outperforming The Market Has Outlived The Reality by Urban Carmel of The Fat Pitch

There are two myths associated with stock buybacks. The first is that companies with large buybacks consistently outperform the market; they don't. The second is that buybacks are responsible for most of the market's earnings growth; also incorrect. It is true that buybacks are an important source of demand and that it has pushed the market indices higher. So it's noteworthy that the amount of money being spent on buybacks has been declining since the start of 2014.

2015-04-02 00:00:00 Henderson Strategic Income Fund (HFAIX) 1st Quarter 2015 Review by Jenna Barnard, CFA, Co-Head of Retail Fixed Income (Article)

Jenna Barnard, CFA, co-lead portfolio manager of the Henderson Strategic Income Fund (HFAIX) provides a 1st quarter 2015 update on the performance and positioning of the Fund. She notes that the Strategic Income Fund has seen strong relative performance on the back of an overweight to the European fixed income market in particular favored themes such as legacy banking bonds, investment grade insurance and the convergence of the European telecommunications sector. As of 2/28/15 the Fund held the following securities: Liberty Global 2.6% of NAV, Vodafone 0.0% of NAV.

2015-04-02 00:00:00 The Perfect Storm for Risk-Conscious Active Managers by (Article)

Principal and Portfolio Manager Steve Lipper discusses three specific conditions that have shaped the current small-cap market and how, after five years, these developments all showed signs of reversing in the latter part of 2014.

2015-04-02 00:00:00 1Q15 Market: Slow Start Leads to Solid Gains by Jack Fockler of The Royce Funds

A bearish January gave way to solid first-quarter gains. The small-cap Russell 2000 was the leader among the broad-based domestic indexes, up 4.3% versus gains of 1.6% and 1.0% for the large-cap Russell 1000 and S&P 500 indexes, respectively. The more tech-oriented Nasdaq Composite was also strong with a 3.5% first-quarter return.

2015-04-02 00:00:00 Market's March Madness by Burt White of LPL Financial

With the NCAA Final Four set, we share our own Final Four for stock market investing: economy, earnings, technicals, and valuations. With valuations above average and the economy slowing during first quarter of 2015, our championship game comes down to earnings and technicals. Based on our assessment of these four factors, we expect stock market investors will be “cutting down the nets” due to potential mid- to-high-single-digit stock market gains in 2015.

2015-04-02 00:00:00 The ECB's QE program: Don't judge a book... by Paul Grillo and Wen-Dar Chen of Delaware Investments

The European Central Bank’s (the ECB’s) historic quantitative easing (QE) program, which commenced operations on Monday, March 9, is a unique animal. Despite the temptation for onlookers to draw similarities, the program is not quite like the rounds of easing undertaken by other major central banks since the end of the global financial crisis.

2015-04-02 00:00:00 Optimism amid a global view of equities by Todd A. Bassion of Delaware Investments

The Organization for Economic Cooperation and Development (OECD) reported on Wednesday that it expects India’s economy to grow by 7.7% in 2015, making it the fastest-growing major economy in the world. This puts India in a position to possibly outpace China, where growth is slowing to the government’s official target of approximately 7%.

2015-04-02 00:00:00 How should we think about risk today in an investment world that has largely rewarded it? by Francis Gannon of The Royce Funds

The removal of "patience" from the Federal Reserve's vernacular might be as close as investors get to a more concrete timeframe for an increase in interest rates, at least for now.

2015-04-02 00:00:00 Convertibles Address Multiple Investor Needs by John P. Calamos, Sr. of Calamos Investments

I began investing in convertible securities during the 1970s, and since then, I’ve seen an exciting evolution of the asset class—from little-known securities to a global asset class totaling approximately $342 billion USD today, including issues from household-name companies worldwide. Clearly, what began as an “alternative investment” has become much more mainstream.

2015-04-02 00:00:00 The Bull Market Turns Six by Doug Ramsey of Leuthold Weeden Capital Management

We cautioned investors during the current bull market’s initial blast-off not to expect a repeat of the prior bull market’s leadership—namely, Emerging Market equities and commodity-oriented equity sectors. Excesses built up during a sustained leadership cycle (i.e., equity valuations, production capacity) require a long period to be surged, generally resulting in the former leaders “skipping” a market cycle from a relative performance perspective. That view has been on the mark…

2015-04-01 00:00:00 March Madness by Bill Gross of Janus Capital Group

If there ever was an economic concept that currently is not a layup, it would be what the future average level of Fed Funds will be. No one really knows and unlike the gimme layup that Coach K provided for me, there are no “gimmes” when it comes to scoring a Fed Funds basket.

2015-04-01 00:00:00 Will the UK Election Derail the Recovery? by Mike Amey of PIMCO

While the economic outlook for the UK is not without risk, most notably if there is an extended period of political paralysis, the UK recovery is much better shape than during the last general election in 2010 and should stay its course. We believe the benign inflationary backdrop will aid economic growth that saw GDP gains of 0.6% for the final quarter of 2014. In an environment of subdued underlying inflationary pressures and sterling appreciating relative to its major trading partners, the Bank of England can afford to wait to tighten monetary policy.

2015-04-01 00:00:00 Well, you know this is a bull market [in government bonds]! by Team of GaveKal Capital

Those familiar with "Reminiscences of a Stock Operator" will recall several scenes in which young traders are gathered at a brokerage house exchanging ideas and contemplating every tick on the tape as if marked some monumental episode for owners of the stock. Then one of the young traders would ask a quiet veteran trader, who was sitting in the corner paying little or no attention the topic de jure, what he thought of the recent price action of some issue, to which the veteran would reply, “Well, you know this is a bull market”.

2015-04-01 00:00:00 The Coming Chinese Crackup? by Andy Rothman of Matthews Asia

Prominent China scholar David Shambaugh has turned bearish on the Middle Kingdom, which offers us the chance to review our own thinking about China’s prospects. As head of the China Policy Program at The George Washington University, Shambaugh is a respected analyst of Chinese Communist Party affairs, so his WSJ op-ed, “The Coming Chinese Crackup,” has received much attention. This issue of Sinology explores how Shambaugh’s view now is an about face from his prior analyses, and why his current arguments may be flawed.

2015-04-01 00:00:00 Chuck Royce on 1Q15: Will Rising Rates Benefit Active Stock Pickers? by Chuck Royce of The Royce Funds

With a rise in interest rates on the horizon, and economic recovery firmly underway, CEO Chuck Royce believes the market may be on the cusp of rewarding disciplined and risk-conscious approaches.

2015-04-01 00:00:00 In the Know: Europe’s Capital Markets Union by Norm Boersma of Franklin Templeton Investments

Templeton Global Equity Group’s Norm Boersma discusses the European Commission’s newly unveiled proposals for Capital Markets Union.

2015-04-01 00:00:00 China to Take the Reins in Funding Regional Infrastructure Projects by Frank Holmes of U.S. Global Investors

This Tuesday marked the last day that countries could submit their applications to become founding members of the new China-led Asian Infrastructure Investment Bank (AIIB). As of this writing, a little over 40 nations have either already been approved or have applied for membership, including strong U.S. allies such as Britain, Germany and Australia.

2015-04-01 00:00:00 How Europe’s QE Could Be a Stimulus for U.S. based Investors by Heidi Richardson of BlackRock Investment Management

Heidi Richardson sees several catalysts that point to strong investment opportunities in Germany and the broader eurozone.

2015-04-01 00:00:00 Running to Stand Still: Wild Swings Taking Market Nowhere by Liz Ann Sonders of Charles Schwab

Stocks have gone 28 trading days without back-to-back gains; a very unique experience historically. Uncertainty abounds, associated with Fed policy, economic surprises on the weak side, and earnings which have dropped into negative territory. Investor sentiment is swinging more wildly than is normally the case.

2015-04-01 00:00:00 Euphoria and Reality in European Stocks by Michele Patri of AllianceBernstein

Euro-area stock markets have rebounded as the ECB has launched its QE program. In our view, investors should take a pragmatic approach that aims to capture the gains—but with eyes wide open to reality.

2015-04-01 00:00:00 Things That Go Bump in the Night by Dwaine Van Vuuren of RecessionALERT.com

The U.S economy appears unstoppable right now. Just about every leading and co-incident indicator you can think of is pointing to positive growth. Among the hundreds of indicators we follow for our models on a daily basis, we have discovered a few that are displaying worrying trends and flagging a future recession. It should be pointed out that a handful of indicators flagging recession should not mean we have to push the panic button. A large raft of indicators all concurring is what you should be looking for, and right now a large raft of indicators is confirming economic growth.

2015-04-01 00:00:00 That’s So Overrated: How Credit Ratings Do Damage by Jeff Skoglund of AllianceBernstein

Credit rating agencies are a capital-markets fixture; the ratings they assign to the debt of corporations and governments are widely used by investors as a standard measure of credit risk. But agency credit ratings aren’t perfect—and shouldn’t be a substitute for investors doing their own analysis.

2015-04-01 00:00:00 Small Korean Companies Punch Above Their Weight by Liliana Castillo Dearth of AllianceBernstein

South Korea’s cultural exports are spreading around the globe. While the country’s corporate landscape is dominated by huge conglomerates, we think small-cap companies stand to benefit most from the world’s growing fascination with all things Korean. It might be time for investors to take a closer look.

2015-04-01 00:00:00 For Canadian Pension Funds, It’s Time to Go Global by Erin Bigley of AllianceBernstein

Pension funds in Canada have long relied on a simple fixed-income strategy: buy Canadian. And for a long time, this worked wonders. But times are changing, and our research suggests that swapping a Canada-only approach for a more globalized portfolio will provide better risk-adjusted returns in the future.

2015-04-01 00:00:00 Recessionary Level in Credit Conditions by Alexander Giryavets of Dynamika Capital L.L.C.

The Credit Managers Index deteriorated significantly over the last two months and current readings stand at the recessionary levels not seen since 2008. There is a very serious financial stress in the amount of credit extended to the businesses and the amount of credit applications rejected. The speed of deterioration is shocking.

2015-04-01 00:00:00 Finding an Oasis in a Bond Liquidity Drought by Gershon Distenfeld of AllianceBernstein

Let’s not mince words: Liquidity is draining out of global corporate bond markets, and we doubt it’s coming back. But that doesn’t mean investors have to take their chips and go home. In fact, with the right approach, less liquid markets can offer some attractive opportunities.

2015-04-01 00:00:00 Geopolitical Risk — The Fear and Reality for Financial Markets by Colin Moore of Columbia Management

Given the threat of geopolitical risk, it is reasonable to question why global financial markets remain so buoyant. The answer may partly be the constant nature of geopolitical risk. Consider the French proverb “plus ça change, plus c'est la même chose” (the more things change, the more they stay the same).

2015-04-01 00:00:00 Why Fed Patience on Rate Hikes Is Likely to Continue by John P. Calamos, Sr. and Gary Black of Calamos Investments

John and Gary discuss how lackluster economic data and low inflation could influence the Fed’s timetable for raising short-term interest rates.

2015-03-31 00:00:00 The Final Say on Spending Rules by Laurence B. Siegel (Article)

After decades of focused research, why can't finance experts decide on a safe withdrawal rate for retirement? It is time to refocus this debate by asking a slightly different question: Is there a spending rule that retirees can use over a fixed time horizon? There is and I call it "the only spending rule you will ever need."

2015-03-31 00:00:00 The Not-So-Hidden Risks in REITs by Keith Jurow (Article)

With most investors confident that equity REITs are a sure bet to continue their upward momentum, now is an excellent time to carefully examine whether this ebullience is justified. Let's see what the conditions in the real-estate market mean for valuations in several of the largest REITs, as well as two of the ETFs that hold them - IYR and VNQ.

2015-03-31 00:00:00 Why 2015 Will Be the Year of the Roth: Meet the “Freight Entrance” Roth 401(k) Conversion by John H. Robinson (Article)

Two new tax rules will affect the treatment of 401(k) monies. Taken individually, the rules were not particularly far-reaching or noteworthy, but together they will reshape the retirement-planning landscape. Roth IRA conversions that previously trickled through the cumbersome "backdoor" will be supplanted by a new wave moving through the "freight entrance."

2015-03-31 00:00:00 Two Routes to Compelling Value by Dan Richards (Article)

Low-cost alternatives for financial advice and investing are forcing advisors to articulate why clients should pay a premium to do business with them. This week's article features two different approaches that could help you communicate your value to prospective and existing clients.

2015-03-31 00:00:00 How Advisors Can Learn Empathy from Doctors by Daniel Solin (Article)

According to a recent article, the mindset of doctors is changing. Empathy skills are no longer dismissed as a "good bedside manner." Indeed, advisors can improve their own empathetic skills by looking at advances in medical training.

2015-03-31 00:00:00 Are You Building a Harley Davidson Practice? by Teresa Riccobuono (Article)

Harley Davidson is the only company I know of whose customers permanently tattoo its name on their body. What is it that makes Harley Davidson customers want to show their support in this way? Bad-boy image, reputation, quality products, exceptional service?

2015-03-31 00:00:00 Helping Younger Advisors Excel by Beverly Flaxington (Article)

What's the best way to integrate a new, young advisor into our practice? We are too small to have a formal training program and I don't have time to sit with someone and provide step-by-step instruction.

2015-03-31 00:00:00 5 Charts: The Troublesome Trajectory of Student Loans by Jennifer Thomas of Loomis Sayles

Although many seem focused on the dangers posed by the recent growth of subprime auto loans, we believe a major looming threat to consumers is coming from student loans. The increasing level of student debt on the millennial generation raises concerns about its sustainability and the impact it may have on known consumer behavior patterns.

2015-03-31 00:00:00 Convertibles Address Multiple Investor Needs by John Calamos, Sr of Calamos Investments

I began investing in convertible securities during the 1970s, and since then, I’ve seen an exciting evolution of the asset class—from little-known securities to a global asset class totaling approximately $342 billion USD today, including issues from household-name companies worldwide. Clearly, what began as an “alternative investment” has become much more mainstream.

2015-03-31 00:00:00 Duration: To Hedge or Not to Hedge? by Jeroen van Bezooijen, Berdibek Ahmedov of PIMCO

Because duration tends to be an important component of the return profile in a bond portfolio, adjusting exposure rather than hedging it away may make sense for many investors. Low duration strategies may provide a level of interest-rate duration that provides a better trade-off between a full market beta (with interest-rate duration) and a fully duration-hedged beta.

2015-03-31 00:00:00 U.S. Isolated in Opposition to Chinese Bank by John Browne of Euro Pacific Capital

Over the past few decades while the economic power of the Chinese has grown exponentially, many observers have been surprised by the relative willingness of China to operate within the financial and economic framework established by the dominant Western order. But it should now be blatantly clear that Beijing prefers to act slowly, deliberately and quietly to advance its agenda.

2015-03-31 00:00:00 Beware Momentum Stocks in Sheep’s Clothing by Russ Koesterich of BlackRock

BlackRock Global Chief Investment Strategist Russ Koesterich discusses the risks in the so-called momentum stocks—as well as some that have been acting that way.

2015-03-31 00:00:00 Should Liquid Alts Be Part of the Core Allocation? by Michael Winchell of Larkin Point Investment Advisors LLC

Many advisors may view alternative investments as diversifiers in portfolios: satellite investments added to a portfolio of stocks and bonds in an attempt to “hedge,” or counterbalance a specific risk the advisor believes is not completely addressed by the stock/bond core. For example, real assets such as gold and real estate are alternatives that may be added to portfolios for inflation protection because advisors expect real assets to rise in value with any overall increase in wages and prices.

2015-03-31 00:00:00 Exploring Four Myths by Byron Wien of Blackstone

In talking with investors, I find four concepts prevail among the consensus that I believe may be wrong. In the interest of full disclosure, it is fair to say that at various points in time I have subscribed to each of these ideas. They are: 1. American Exceptionalism is a thing of the past. 2. The price of oil is likely to stay low for a long time. 3. Europe’s economy is in a slow growth deflationary trap. 4. Abenomics is not working, and Japan is in danger of falling back into a recession. I decided to explore each of these

2015-03-31 00:00:00 On My Radar: Going Forward with Great Purpose! by Steve Blumenthal of CMG Capital Management Group

The Fed tried to talk down the dollar last Wednesday. Essentially firing a warning shot (downgrading estimates for growth, inflation and short-term interest rates). The ultra-low rates in Germany and Japan vs. the U.S. favor the dollar. Anything that points to the Fed raising rates enhances the attractiveness of U.S. bonds and attracts further capital flows.

2015-03-31 00:00:00 Rate Hikes Won't Kill Housing by Brian S. Wesbury and Robert Stein of First Trust Advisors

Home building plummeted in February, which made perfect sense; this February was the coldest for the most Americans since 1979. What no one expected was that new home sales would soar. Bad winter weather usually doesn’t hurt new home sales as much as it hurts housing starts, but it typically has an impact. This time, though, new homes sales spiked 7.8%, hitting the highest level in seven years.

2015-03-31 00:00:00 Corporate Bonds Offer Opportunities in the Slowing Economy by Tracy Chin and Aaditya Thakur of PIMCO

Lack of corporate leveraging and investment among Australian companies may provide a macro headwind to economic growth and, hence, future prospects for equity investors, but from a creditor's perspective, this should keep credit metrics relatively healthy. PIMCO's bottom-up analysis has helped identify several opportunities, even within the resources sector, where strong balance sheets, competitive industry positions and sound management build a compelling case for credit investors despite the challenging period ahead.

2015-03-31 00:00:00 Fit & Focused by Mark R. Kiesel of PIMCO

Many powerful forces are driving markets and asset prices; chief among them are global monetary policy, technicals and fundamentals. We use rigorous top-down and bottom-up analysis to identify the best sectors and companies around the world. We see opportunities in the U.S. (cyclical consumer and housing sectors), Europe (equities, bank capital securities, high yield bonds and corporate hybrids), China (property, technology and Macau) and Japan (cyclical industries, exporters and financials).

2015-03-31 00:00:00 The New World Order: Part III by Bill O’Grady of Confluence Investment Management

In the third installment of our series, we examine how policymakers coped with the superpower role. We examine how policymakers attempted to resolve the tensions created between the desires of domestic constituencies and foreign superpower obligations. We offer a history of how the U.S. managed these differences, with an analysis of Roosevelt’s political configuration and how the Reagan Revolution adjusted to the failures of the first program, detailing these periods with charts. We explain the capability and willingness of the U.S. to continue providing the global public goods to the world.

2015-03-31 00:00:00 Common Stocks: A Garden of Wealth Creation by Bill Smead of Smead Capital Management

We think the reason most investors do not gain the benefit of common stock ownership stems from the blight which comes along about once every five years on average in the stock market. We call this blight a bear market and it usually consists of a decline of greater than 20% in price from the prior stock market peak. There have been nine declines of that magnitude since 1950 in the S&P 500 Index. Three of those declines exceeded 40% and two of them were in the last 15 years.

2015-03-31 00:00:00 Signs of Life in the Eurozone by Nouriel Roubini of Project Syndicate

The latest economic data from the eurozone suggest that recovery may finally be at hand. But a more robust and sustained upturn in job creation and income growth still faces a broad array of daunting challenges.

2015-03-30 00:00:00 Dividend Value Investing: No Time for Suspension of Disbelief, Part 2 by Meggan Walsh of Invesco Blog

While investors may be riveted by Hollywood’s surprise endings and cliffhangers, they generally aren’t fond of unexpected plot twists in the market. So here’s a spoiler alert. The operating results of companies in the current cycle have been quite strong, and many investors expect this to continue. But we’ve seen enough plot twists over time to know this can be a risky assumption.

2015-03-30 00:00:00 Last Chance for Ukraine and Europe by George Soros of Project Syndicate

Ukraine has reached a critical point in its survival struggle; but so, too, has the European Union. And the line beyond which all possible scenarios worsen – for Ukraine and the EU alike – may be just days or weeks away.

2015-03-30 00:00:00 Eating Our Seed Corn: The Causes of U.S. Economic Stagnation, and the Way Forward by John Hussman of Hussman Funds

The U.S. has become a nation preoccupied with eating its seed corn; placing consumption over investment, outsourcing its jobs, hollowing out its middle class, and accumulating increasing debt burdens to do so. What our nation needs most is to adopt fiscal policies that direct those seeds to productive soil, and to reject increasingly arbitrary monetary policies that encourage the nation to focus on what is paper instead of what is real.

2015-03-30 00:00:00 Further Equity Gains Await Earnings Recovery by Robert Doll of Nuveen Asset Management

Downward pressure on U.S. equities returned last week, with the S&P 500 Index falling 2.2%. This marked the second-largest weekly downturn of the year and the fourth negative week in the last five. Some of the decline can be attributed to fading positive sentiment that came in the wake of the recent Federal Reserve meeting. Ongoing negative earnings forecasts have taken their toll as well. All market sectors were in negative territory last week, with financials, technology and industrials losing the most ground and consumer staples and energy holding up the best.

2015-03-30 00:00:00 Federal Funds Rate Expectations: It’s October 2014 All Over Again by Bradley Krom of WisdomTree

After a series of stops and starts, comments from a variety of Fed speakers and a slight pickup in some U.S. economic data, the Fed took the opportunity to deliver a dovish surprise at its March 18 policy meeting.

2015-03-30 00:00:00 China’s New Normal and America’s Old Habits by Stephen Roach of Project Syndicate

China is generating a lot of confusion nowadays, both at home, where officials now tout the economy’s “new normal” but are unclear about what it is, and abroad, where the US is embracing “containment” of China’s rise. On both counts, the disconnects are striking, adding a new dimension of risk to a fragile world.

2015-03-30 00:00:00 Should Liquid Alts Be Part of the Core Allocation? by Michael Winchell of Larkin Point Investment Advisors LLC

Many advisors may view alternative investments as diversifiers in portfolios: satellite investments added to a portfolio of stocks and bonds in an attempt to “hedge,” or counterbalance a specific risk the advisor believes is not completely addressed by the stock/bond core. For example, real assets such as gold and real estate are alternatives that may be added to portfolios for inflation protection because advisors expect real assets to rise in value with any overall increase in wages and prices.

2015-03-30 00:00:00 Equity Option CEFs by (Article)

If you’re looking for a fixed income alternative, you may want to consider equity option CEFs, also known as covered call funds, says Gregory Mino of Nuveen Investments.

2015-03-30 00:00:00 International Equity CEFs by (Article)

International equity closed-end funds may provide access to “best in class” companies in local markets, says Jonathan Morgan of Canadian General Investments.

2015-03-30 00:00:00 EM Sector Featuring Ryan Paylor by (Article)

Ryan Paylor of Thomas J. Herzfeld Advisors shares a CEF market view, commenting on discounts, interest rates and sectors.

2015-03-29 00:00:00 Weighing the Week Ahead: Time for an Economic Spring Thaw? by Jeff Miller of New Arc Investments

In the absence of real data it is easy and tempting to speculate. Unlike last week, the week ahead features an avalanche of data – more in both quantity and importance than we have seen in a month. With some recent significant reports showing economic improvement we expect a change of focus.

2015-03-29 00:00:00 US Equity Market Review For the Week of March 23-27; Hey, We're Still Consolidating, Edition by Hale Stewart of Hale Stewart

Writing about market consolidation is very difficult. There are no strong rallies, massive volume spikes or huge losses to get the reader excited. Instead, the entire analysis focuses on prices pin-balling between two trend lines, usually on decreasing volume and weakening technical indicators. So if you’re looking for an article the grabs your attention by telling a story of an incredibly strong surge in bullish price action, move elsewhere. Because this week we again have a market that is consolidating.

2015-03-29 00:00:00 The Fat Pitch Weekly Market Summary by Urban Carmel of The Fat Pitch

The largely trend-less environment of the past four months continues. Despite the fall this week, US equities are not oversold and sentiment is still heady. This suggests that a rally early in the week would likely fail. While April is one of the best months of the year, the first half of the month has been weak. If this pattern continues this year, there would likely be a more attractive entry point mid-month.

2015-03-29 00:00:00 ECRI Recession Watch: Weekly Update by Doug Short of Advisor Perspectives (dshort.com)

Friday's release of the publicly available data from the Economic Cycle Research Institute (ECRI) puts its Weekly Leading Index (WLI) at 131.6, up slightly from 131.2 the previous week. The WLI annualized growth indicator (WLIg) is at -3.2, up from the previous week's -3.6 and off its interim low of -4.9 in mid-January.

2015-03-28 00:00:00 International Equity Commentary: February 2015 by Team of Thomas White International

International equity prices gained during February on expectations that the central banks in Europe and Japan would continue their quantitative easing programs, while the U.S. Federal Reserve could possibly delay its interest rate hikes. At the same time, economic trends from most major economies remained relatively stable. After two quarters of robust gains, the U.S. economy expanded at a slower pace during the fourth quarter of 2014, as expected.

2015-03-28 00:00:00 Living in a Free-Lunch World by John Mauldin of Mauldin Economics

I believe the fundamental imbalances we are seeing in the world (highlighted in the two papers mentioned above) are the result of the massive increases in global debt and misunderstandings about the use and consequences of debt. Too much of the wrong kind of debt is going to be the central cause of the next investment crisis.

2015-03-27 00:00:00 Liquidity by Howard Marks of Oaktree Capital Management

My wife Nancy’s accusations of repetitiveness notwithstanding, once in a while I think of something about which I haven’t written much. Liquidity is one of those things. I’m not sure it’s a profound topic, and perhaps my observations won’t be either. But I think it’s worth a memo.

2015-03-27 00:00:00 Emerging Markets Equity Commentary: February 2015 by Team of Thomas White International

Emerging Market Equities Emerging market equity prices advanced during the month of February on signs of improvement in global economic trends as well as expectations about quantitative easing in Europe and Japan. Encouraged by reduced inflation risks after the oil price decline, some of the emerging market central banks have also lowered interest rates in recent months.

2015-03-27 00:00:00 Global Economic Outlook Involves More than Fed News by Andrew Pease of Russell Investments

Andrew Pease outlines the key economic outlook points and key watch points going forward.

2015-03-27 00:00:00 Enjoying the Shade by Patricia Huang and The Matthews Asia Investment Team of Matthews Asia

As commentator Cherian George has said: “The legacy passed down to today’s Singaporeans isn’t one of random opportunism…There is nothing accidental about it.” Singapore’s first prime minister, Lee Kuan Yew, took charge of the city-state, transformed and drove it forward in the span of just a few decades. This week Matthews Asia pays tribute to this “giant of history.”

2015-03-27 00:00:00 Woe Betide the Value Investor by Jason Hsu, Vivek Viswanathan of Research Affiliates

The excess return earned by the average investor in value mutual funds was meaningfully negative over a 23-year period when the funds themselves outperformed the market. Why don’t all value investors benefit from the value premium?

2015-03-27 00:00:00 Are Equities Overvalued? by Michael Spence of Project Syndicate

Since the global economic crisis, sharp divergences in economic performance have contributed to significant stock-market volatility. Now, stocks are reaching relatively high levels by conventional measures – and it is difficult to discern precisely why.

2015-03-27 00:00:00 In a Challenging Environment, Policy Easing Sweeps Through Asia by Adam Bowe, Tomoya Masanao, Isaac Meng of PIMCO

The key change to our cyclical outlook for Asia: We have further downgraded our growth forecast for China to the low-6% range as real borrowing rates remain elevated. In Japan, we expect growth to recover from last year's technical recession, following the delay in the next value-added tax (VAT) hike and the increase in the Bank of Japan's easing program.

2015-03-27 00:00:00 Global Asset Allocation Shifts by Alexander Giryavets of Dynamika Capital L.L.C.

A couple of days ago BIS (Bank of International Settlements) released a seminal research piece “Global Asset Allocation Shifts” in which authors explain that weekly institutional and retail portfolio reallocations (not just fund flows) of U.S. investors are 90% driven by two factors easily identified as Yen (Risk On/Off) and Dollar factors hence reaffirming our Global Macro Framework. They also explore systematic predictability of these factors in great details.

2015-03-27 00:00:00 A Deeper Look at Smart Beta in Fixed Income by Sara Shores of BlackRock

While most tend to think of smart beta as a tool for stock portfolios, there are ways to apply it to bonds. Sara Shores shares a smart beta approach to balancing interest rate and credit risk.

2015-03-27 00:00:00 Japanese 10-Year Rates Double in 2015, Rise Above German Bunds by Bradley Krom of WisdomTree

Since reaching historic lows in mid-January, Japanese government bond (JGB)yields have doubled over the last several weeks. In the process, they have eclipsed German 10-year bund yields for the first time in over 20 years.

2015-03-27 00:00:00 A Tale of Two Economies: Singapore and Cuba by Frank Holmes of U.S. Global Investors

It would be nearly impossible to find two world leaders in living memory whose influence is more inextricably linked to the countries they presided over than Cuba’s Fidel Castro and Singapore’s Lee Kuan Yew, who passed away this Monday at the age of 91.

2015-03-27 00:00:00 REITs in a Rising Interest-Rate Environment by Wilson Magee of Franklin Templeton Investments

Wilson Magee, director of global real estate and infrastructure securities, Franklin Real Asset Advisors®, believes this environment is causing many investors to search for alternative investments that can add an income-oriented asset to their portfolio as well as gain exposure to global economic growth potential. He outlines why he thinks it’s an opportune time for many investors to consider diversifying into global real estate through an actively managed investment vehicle.

2015-03-27 00:00:00 Growth Expectations Are No Longer Cratering For Energy Stocks by Team of GaveKal Capital

Sales and earning growth expectations for energy stocks are still pretty awful for the next fiscal year (FY1). Sales are expected to drop by 17% and earnings by a whopping -29%. However, earnings are expected to make a V-shaped rebound. Analysts expect sales to grow by an average of 12.3% per year over the next three years (FY2-FY4). The rebound in earnings is expected to be even stronger. Earnings are expected to grow by an average of 32.5% per year over the following three years (FY2-FY4). These expectations are setting a high bar for the energy sector for 2016-2018.

2015-03-27 00:00:00 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

After Slow Start, the U.S. Should Regain Steam; Greece: The Debt Elephant in the Room; How Can Governments Keep Borrowing Under Control?

2015-03-27 00:00:00 The Monetary Illusion by Scott Minerd of Guggenheim Partners

The long-term consequences of global QE are likely to permanently impair living standards for generations to come while creating a false illusion of reviving prosperity.

2015-03-27 00:00:00 Will a Spring Thaw Lead to a Stock Surge? by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

US economic data has been soft, repeating a trend we’ve seen in recent first quarters. But we believe growth will again bounce back as some of the temporary weights drop off. US stocks should continue to grind generally higher—but with heightened volatility—aided by better data and a still-dovish Federal Reserve. But investors shouldn’t ignore international opportunities. Global growth generally appears to be improving and foreign central banks are largely easing monetary policy, potentially benefiting risk assets.

2015-03-27 00:00:00 Deglobalization Redraws the Investment Map by Hayden Briscoe and Vincent Tsui of AllianceBernstein

Divergence between economies and financial markets has been a key macroeconomic trend over the last few years, and reflects in part the deglobalization of the worldwide supply chain. We expect the big winners to be countries and regions with large internal markets; the losers will be smaller countries which have yet to move up the export value chain.

2015-03-27 00:00:00 In US Small-Caps, Quality Is on Sale by James MacGregor of AllianceBernstein

Investors who wanted safety and certainty last year mostly shunned smaller-cap US stocks. As a result, many high-quality names are now on sale. With US growth likely to accelerate in 2015, we think these domestically oriented smaller-cap companies may turn out to be a real bargain.

2015-03-26 00:00:00 OFR: Assessing The Risk Of Overvalued Markets by Lance Roberts of Streettalk Live

A Review Of The Office Of Financial Research report on valuation risks and consequences.

2015-03-26 00:00:00 The Relationship of Suds and Bubbles by Matt Lloyd of Advisors Asset Management

The proliferation of news, information, opinion and fact (which all come across in the same way) has had an overwhelming effect on the common investor and the instructional as well. Attempting to delineate the crowded trade from the minority viewpoint is a far greater task currently. Though this increased dissemination of information is beyond the recognition of the investor’s psyche, it does have a more pronounced positive impact.

2015-03-26 00:00:00 Investment Times Are A Changin’: New Landscape and New Approaches by David Robertson of Arete Asset Management

Significant changes over the past 30-40 years make it very likely the next 30-40 will be very different than the last. Investors who are able to discard old assumptions and adapt to the new environment will be best suited to succeed and those who can’t or won’t will struggle. One thing that will have to change is that investors will need better access to high level investment expertise.

2015-03-26 00:00:00 Global Economic Overview: February 2015 by Team of Thomas White International

The global economic outlook improved in February, helped by encouraging data from some of the largest countries as well as supportive monetary policy measures. Monthly job additions in the U.S. exceeded expectations in February, continuing the robust trend from last year. Though wages are yet to see meaningful growth, the strengthening labor market should help the U.S. economy sustain the current pace of expansion.

2015-03-26 00:00:00 Dove or Ivory? A Case Study on Currency Impacts by Jeremy Schwartz of WisdomTree

Given the divergence of central bank policies, currencies are among the most important investment topics today. If the U.S. dollar continues to strengthen, it may be a headwind to U.S. multinationals earning revenue abroad, while boosting foreign companies that are earning revenue in the United States.

2015-03-26 00:00:00 Latin America Is Blowing Up Your EM ETF Performance by Team of GaveKal Capital

On an equal-weighted, USD basis, the MSCI Emerging Markets Index is up just 0.99% YTD compared to MSCI World Index which is up 5.65%. So is this just a simple continuation of the trend of emerging market underperformance that has been in place over the last 4 years ? Yes, but with a caveat.

2015-03-26 00:00:00 The Labor Market Conundrum: The Cyclical and the Secular by Russ Koesterich of BlackRock

Low workforce participation and slow wage growth are structural issues that the strengthening U.S. labor market must overcome in the long run.

2015-03-26 00:00:00 Why This Airline Just Landed in the S&P 500 Index by Frank Holmes of U.S. Global Investors

For the first time in its 84-year history, American Airlines was cleared for landing in the S&P 500 Index.

2015-03-26 00:00:00 Breaking Up is Hard to Do by Anthony Valeri of LPL Financial

The high-yield energy sector has kept pace with the broader high-yield bond market in 2015 even as oil prices weakened, a notable difference from 2014. Although we don’t believe the high-yield bond market will return to the June 2014 peak, the current yield spread may still represent good value given still strong corporate fundamentals and low defaults.

2015-03-26 00:00:00 Data Dependence, Broadly Defined - Implications of Last Week’s Fed Meeting by Zach Pandl of Columbia Management

At last week’s meeting, the FOMC made a widely-anticipated but nonetheless important change to the statement, dropping a commitment to be “patient” and thereby creating the option to hike rates at any meeting after April. In the end, this proved to be a sideshow to the more interesting changes in the Fed’s Summary of Economic Projections (SEP)—the forecasts officials’ provide at every other FOMC meeting.

2015-03-26 00:00:00 Rates and Bonds by Heather Rupp of AdvisorShares

So at long last we know whether the word “patient” stays or goes: it’s gone and Treasury yields have actually declined as a result. So far this year we have seen rates go from a 2015 low of 1.19% on the 5-year and 1.68% on the 10-year on February 2nd, and then spike a month later at 1.70% and 2.24%, respectively, on March 6th. So an over 50bps move in a month all over the worry about the word “patient” and whether rates will rise as early as June. Only for rates to fall after the statement was released and the key word removed.

2015-03-25 00:00:00 The Dollar Isn't the Peso Anymore (Part II) by Richard Bernstein of Eaton Vance

In May 2013, Richard wrote a report titled “The Dollar isn’t the Peso anymore.” He rebutted the argument that the U.S. dollar (USD) was weak. The data showed that the USD had actually troughed in the spring of 2008. For seven years now, the USD has been gaining strength and is today a standout among the world’s currencies.

2015-03-25 00:00:00 US Economy Badly Disappoints Analysts' Expectations by Gary Halbert of Halbert Wealth Management

Today we will talk about an economic indicator that I have not written about before, which is compiled and reported monthly by CitiGroup, the American multinational banking and financial services corporation headquartered in Manhattan.

2015-03-25 00:00:00 Five Reasons Why Interest Rates Will Stay Low by Jerry Wagner of Flexible Plan Investments

Last week we focused on investors’ waiting game with the Federal Reserve. Would their policy statement following last Wednesday’s meeting, like last month’s Groundhog Day sighting, suggest more weeks of winter in the form of rising interest rates?

2015-03-25 00:00:00 Silver and Gold: I Really Want to Look Up by Avi Gilburt of ElliottWaveTrader.net

For the last several weeks, I have provided you, and, sometimes even entertained you, with my perspective of a very evil pattern to play out in the metals. Such a pattern was supposed to test the 2014’s lows (and potentially even break them), and then rally to the 2015 highs to set up the final decline to the lower lows to end the 3+ year correction in silver.

2015-03-25 00:00:00 Can ECB Policy Heal Europe’s Ills? by Mike Amey, Andrew Bosomworth, Lorenzo Pagani of PIMCO

In this interview, Managing Directors Mike Amey, Andrew Bosomworth and Lorenzo Pagani discuss the conclusions from PIMCO’s quarterly Cyclical Forum in March 2015 and how they influence our European investment strategy. They also delve into the impact of the European Central Bank’s (ECB) balance sheet expansion on growth and inflation and reflect on Europe’s improving economic health.

2015-03-25 00:00:00 The Dollar's Ripple Effect by Burt White of LPL Financial

In technical analysis, “intermarket analysis” looks at the way in which various markets interact. Intermarket analysis primarily looks at four market sectors: currencies, commodities, bonds, and stocks. From a technical analyst’s perspective, focusing our attention on only one market without considering what’s happening in the others leaves us in danger of missing vital directional clues and potential profits. The dollar, which has appreciated 24.4% since June 30, 2014 (as of March 19, 2015), has had an unusually strong intermarket effect of late.

2015-03-25 00:00:00 Active vs. Passive Redux by Jeffrey Saut of Raymond James

Most of you know I spend my days gathering “thin reeds” and try to weave them into a favorable “investment bouquet.” As Yogi Berra said, “You can observe a lot by just watchin’!”

2015-03-25 00:00:00 Fed Policy Outlook - in *Retrograde? by Scott Brown of Raymond James

The question of whether the Fed would abandon the “patient” language should have not been an issue, but the financial press always tries to generate some level of tension. However, while the Federal Open Market Committee appeared to move closer to tightening monetary policy, it indirectly signaled that it would likely be much less aggressive.

2015-03-25 00:00:00 Signs of a Normalizing Market by Chris Clark of The Royce Funds

In the wake of the 2008 financial crisis, the Fed's monetary stimulus programs had the unintended effect of suspending the historically typical functioning of capital markets in terms of the productive and destructive uses of capital. Today, the fiscal climate is beginning to change. President and Co-Chief Investment Officer Chris Clark takes a look at what's happening in the current market and talks about why our discipline could be rewarded in the foreseeable future.

2015-03-24 00:00:00 An In-Depth Look at Fidelity's Contrafund by Larry Swedroe (Article)

Fidelity's largest actively managed fund is the Contrafund (FCNTX). It's also among Fidelity's top performers, making it their flagship fund, a status previously accorded to the Magellan Fund under Peter Lynch. Will Contrafund investors continue to enjoy outperformance or will they face flagging returns like Magellan's investors did following Lynch's departure?

2015-03-24 00:00:00 How do Deferred-Income Annuities Stack Up Against Rival Products? by Joe Tomlinson (Article)

Deferred-income annuities (DIAs) have received a lot of attention with new Treasury Department regulations encouraging their use. Many tout them as providing the most cost-effective way to generate retirement income. But retirement products are not one-size-fits-all. I'll show where DIAs fit among the products and investment solutions available to advisors.

2015-03-24 00:00:00 Krugman at His Worst by Robert Huebscher (Article)

As an economist, Paul Krugman has much to offer. Sometimes I agree with him, but more often he challenges me to defend my opposing position. When he uses his privileged perch at the New York Times to advance his political agenda, however, he is nothing more than another second-rate "talking head" littering the media. Such was the case with his column on March 16, Israel's Gilded Age.

2015-03-24 00:00:00 Two Approaches to Landing New Clients by Dan Richards (Article)

What does it take to build a high-performance team? My analysis shows that the best advisors follow two distinct approaches.

2015-03-24 00:00:00 Negative News and Bad Decisions by Daniel Solin (Article)

The financial media is engaged in a relentless pursuit of negative news items. They know it creates anxiety among investors, which increases viewers and readers. Understanding the role of negative news in your clients' lives will help you guide them toward sound and rational decisions.

2015-03-24 00:00:00 Words Every Client Likes to Hear by Beverly Flaxington (Article)

I've read a lot about different ways to show appreciation for clients: events to plan, gifts to send, newsletters to write, etc. Is there one thing that stands out more than anything else when it comes to letting clients know how important they are?

2015-03-24 00:00:00 The Economic Outlook by George Mokrzan of Huntington National Bank

The United States forecast is for solid average annual economic growth of 3.1% in 2015 -- fastest in the economic recovery to date overall, although areas of the economy with high energy or international exposure will likely encounter headwinds. Strengthening employment conditions, continual improvements in consumer finances and steadily rising housing markets are likely to reestablish the consumer’s lead role in the U.S. economy in 2015.

2015-03-24 00:00:00 A New Playbook for Diversification by Chris Arthur of Eaton Vance

Is an active/passive/smart beta strategy the future of diversification? Chris Arthur, CFA, sees a growing need for a new approach and explains how this one works.

2015-03-24 00:00:00 March Economic Update by Kevin Moloney of Bronfman E.L. Rothschild

With the unemployment rate dropping to 5.5% in early March, the economy has reached the upper limits of the Federal Reserve’s estimate of long-run normal unemployment (5.2% - 5.5%). GDP growth remains stable, with a current estimate of 2.2% growth for the fourth quarter of 2014. The housing market recovery continues at a slow-but-steady pace, with prices rising twice as much as inflation during 2014 (+4.5%) according to the 20 city Case-Shiller Index. The most uncertain aspect of the economic recovery in the U.S. remains the consumer.

2015-03-24 00:00:00 The Active Passive Debate Evolves by Necessity by Roger Nusbaum of AdvisorShares

Daily Alts took a stab at the topic of evolving asset allocation and the blurring of the line between active and passive citing work/theory done by Eaton Vance. As a starting point, and something we’ve been talking about here for several years, the basic 60/40 may be losing some of its effectiveness especially on the 40 side, the fixed income portion, because interest rates are so low and as we learned from the most recent Fed statement may stay lower for longer. The article also considered a blurring of the line between active and passive management.

2015-03-24 00:00:00 Don't Fret Student Debt by Brian Wesbury, Robert Stein of First Trust Advisors

For the past six years, investors have faced one fear after another. One of those fears has been the more than $1 trillion of student loan debt outstanding. This debt is up 160% since the start of 2006 (and growing) while the share of student loans with payments 90 days late, or longer, has risen from 6.4% to 11.3%.

2015-03-24 00:00:00 US Equity Market Review For the Week of March 16-20: Small and Mid-Caps Outperform, Edition by Hale Stewart of XE Currency Blog

Last week, both the small and mid-cap ETFs broke through upside resistance and printed new highs. The IWCs were up 2.5% for the week, closing at 80.49 while the IJHs rose 4.5% and closed at 153.69. This continues a trend that started in early October where the small and mid-cap sectors outperformed the mega-cap stocks.

2015-03-24 00:00:00 A Relatively Dovish Fed Statement Helps Equities Recover Ground by Robert Doll of Nuveen Asset Management

Last week featured some disappointing economic data and further downward revisions of corporate earnings estimates, but investors focused heavily on last week’s Federal Reserve policy meeting. The Fed’s statement was more dovish than expected, and investors interpreted the comments as an indication that rate increases would not happen as soon as some anticipated.

2015-03-24 00:00:00 The New World Order: Part II by Bill O'Grady of Confluence Investment Management

In the second installment of our four-part series we focus on two themes. First, we examine the global public goods the superpower provides, and second, we analyze how the U.S. has done so. The global hegemon often faces tensions between the desires of domestic constituencies and its foreign obligations. Every superpower negotiates these pressures and each tends to have its own ways of meeting both objectives. However, no superpower can subjugate the goals and aspirations of its citizens indefinitely. If the cost of hegemony becomes too high, a nation may be unable to maintain the position.

2015-03-24 00:00:00 U.S. Trade: Shortchanged by a Strong Dollar? by Milton Ezrati of Lord Abbett

Worries that the elevated value of the greenback will crimp U.S. exports—and hurt corporate profits—are overstated.

2015-03-24 00:00:00 Cash Dividends are Key by Richard Skaggs of Loomis Sayles

The income potential of equities is positive right now – especially in this low interest rate and low inflation environment. The S&P 500 currently boasts a yield of around 2.0% and (assuming no recession) dividends should continue to grow.

2015-03-24 00:00:00 Give'em the Old Razzle Dazzle by Peter Schiff of Euro Pacific Capital

Janet Yellen channels Billy Flynn? Last week the Fed Chairwoman treated us to a master class of rhetorical misdirection which produced some memorable examples of doublespeak, including the soon to be classic "Just because we removed the word 'patient' does not mean we're going to be 'impatient."' But perhaps more surprising than her new heights of verbal dexterity was the market's euphoria at being so blatantly manipulated. Never has the financial world enjoyed a lie so thoroughly.

2015-03-23 00:00:00 Monetary Policy and the Economy: The Case for Rules Versus Discretion by John Hussman of Hussman Funds

Deviations in monetary policy from what one would have predicted (using past non-monetary variables alone) have zero correlation or ability to explain subsequent GDP growth (versus the levels that would have been predicted by past non-monetary variables alone). In other words, once we allow for the component of monetary policy captured by a fixed linear rule (the Taylor Rule comes close – and currently indicates an appropriate Fed funds rate of about 3% here), one can find no evidence in the historical record that additional activist monetary policy is useful.

2015-03-23 00:00:00 Dividend Value Investing: No Time for Suspension of Disbelief by Meggan Walsh of Invesco Blog

When Hollywood tells a story, the expectation is that viewers are willing to suspend disbelief to fully immerse themselves in the plot. But when the market tells a story, suspending disbelief may result in overly complacent investors who blithely ignore the potential downside risk of a profit cycle in its later stages, which we see today through the lens of our full-cycle perspective.

2015-03-23 00:00:00 Building a High-Conviction Portfolio of Superior Businesses by (Article)

Portfolio Manager Lauren Romeo talks about how many holdings that populate this Royce portfolio are companies we have seen persevere through various economic cycles, changing industry conditions, and company-specific challenges.

2015-03-23 00:00:00 Special Equity Fund: Looking Back at 2014 and Ahead to 2015 by (Article)

Portfolio Manager Charlie Dreifus discusses the current state of Royce Special Equity Fund's portfolio and what he believes could be a potential tailwind for some of his holdings as the year develops.

2015-03-23 00:00:00 A Body at Rest by Brian Andrew of Cleary Gull

As the temperature rises above 50 for the first time in several months, I am reminded of this Newtonian law that a body at rest will stay at rest unless an outside force acts on it. Perhaps the warm-up in weather is the “outside force” we all need to get moving again. I believe that the current market environment is similar to my body coming out of winter.

2015-03-23 00:00:00 Central Bank Policies And Market Distortions by Sebastiao Buck Tocalino of SBTCapital Clube de Investimento

Recurrent countercyclical monetary policies have given way to several distortions in the economy. It is believed that printed dollars have inflated both stocks and bonds in the US, but that is a misunderstanding! Still attractive, US Treasury Bonds may provide the basis for a sustained appreciation of the US dollar against foreign currencies. Once more, the widely anticipated interest rate hike by the FOMC may get postponed… further into oblivion!

2015-03-23 00:00:00 How Should Advisors Evaluate Alternative Strategies? by Michael Winchell of Larkin Point Investment Advisors LLC

Because modern portfolio theory emphasizes the value of holding instruments having low cross-correlations, we’ve heard many advisors describe the search for alternative investments as a search for assets with low correlations to either equities or bonds. This leads advisors too often to consider nontraditional assets over alternative strategies. We believe that perspective is too narrow and misses the larger point. It is our opinion that clients primarily desire reasonable returns with low volatility, and that there are many ways to achieve that goal.

2015-03-23 00:00:00 Tracking the Market with Social Media by Blair Jensen of Trade Followers

The Trade Followers 7 Day momentum indicator for the S&P 500 index (SPX) has confirmed the new uptrend and is indicating that it will most likely have staying power. One kink in the works is that momentum is overbought. This indicates that the market will need to digest recent gains before it can break to all time highs.

2015-03-23 00:00:00 On My Radar: Investors Behaving Badly by Steve Blumenthal of CMG Capital Management Group

There were several charts that caught my eye this week. The first is a chart that tells us the likely annual return for the S&P 500 Index will average just 2.25% over the next ten years. Many valuation measurements support a period of probable low future returns, but this particular data is different – it looks at the percentage of household equity ownership.

2015-03-23 00:00:00 Weighing the Week Ahead: The Quest for New Worries by Jeff Miller of New Arc Investments

In my last WTWA (two weeks ago, since I am allegedly on vacation. I resumed work on Fed day to watch and to meet with readers and potential investors near New Orleans. Next week I’ll be back on my normal). I asked whether good news was now bad for investors. The continuing Fed focus was once again a successful theme, despite the increasing irrelevance of Fed policy.

2015-03-23 00:00:00 Time to Ratchet Up Risk Management? Volatility is Back in Vogue by Patty Quinn McAuley of Clark Capital Management Group

Considering the full spectrum of risk management tools available when building asset allocations can help ensure that clients make the right decisions about their money regardless of market conditions. A personalized risk management approach will adjust and adapt to the changing markets based upon the desired outcome or goal of the client.

2015-03-23 00:00:00 Euro: Parity Like It’s 1999 by Scott Minerd of Guggenheim Partners

Europe stands to benefit as the euro nears parity with the U.S. dollar; the Fed knows the U.S. economy faces a winter soft patch; the outlook for equities and fixed income remains fundamentally strong.

2015-03-21 00:00:00 The Fed -- Drunken Coxswain of the SS America by Paul Kasriel of Econtrarian, LLC

What if the Fed’s luck should change for the worse without its “smarts” changing for better? Well, that question now is relevant. After rebounding to a rate approximately equal to its long-run median, growth in total thin-air credit sharply decelerated in February, both on a year-over-year basis as well as a three-month basis.

2015-03-21 00:00:00 It’s Good to Be Better by Richard Davies of AllianceBernstein

What’s the real point of having a defined contribution (DC) plan in the first place? That’s the big question US plan sponsors needs to ask themselves. If the answer is helping employees achieve better retirement outcomes, then the DC plan can’t just be good: it’s got to be better.

2015-03-21 00:00:00 Beating the Emerging Benchmark Blues by Morgan Harting of AllianceBernstein

It’s been another tough start to the year for emerging-market equities, amid growing concern about political risk and economic growth. But we believe the seeds have been sown for a recovery that can best be captured through a selective investing approach to avoid the risks of a benchmark.

2015-03-21 00:00:00 Five Reasons to Hold High Yield in 2015 by K. Sean Clark of Clark Capital Management Group

We believe that the high yield market may reward investors who adopt a tactical approach. Here are five reasons we anticipate a reemergence of opportunities in the high yield space in 2015.

2015-03-21 00:00:00 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

What Is Full Employment, and Are We There Yet?; Negative Interest Rates Are Spreading Across Europe; The Return of the U.S. Debt Ceiling

2015-03-21 00:00:00 Stuck in Neutral by Rob Isbitts of Sungarden Investment Research

We see emphasis on “neutrality” in outlook in several of the indicators we follow at Sungarden, including our Sungarden® Stock Scoring System. From a fundamental and technical standpoint, we see fewer screaming long-term buys than we have in some time, yet we also don’t see too many situations that signal pending disaster.

2015-03-21 00:00:00 What the Federal Reserve and the Fear Trade Do for Gold by Frank Holmes of U.S. Global Investors

Following the Federal Open Market Committee (FOMC) meeting yesterday, Federal Reserve Chair Janet Yellen made it clear (again) that interest rates would not be raised until inflation gains more steam. With current inflation rates negative for the first time since 2009, and with the U.S. dollar index at an 11-year high, we can probably expect near-record-low interest rates for some time longer.

2015-03-21 00:00:00 Optimism, Pessimism and Opportunity by Ed Perks of Franklin Templeton

Given that the S&P 500 has been on a tear since 2008, logging double-digit returns in five of the past six years, and US Treasury rates remain near historical low levels, many investors are questioning their prospects for long-term total return. Ed Perks, chief investment officer and portfolio manager, Franklin Equity Group®, offers his views on why he remains optimistic about the US market’s prospects, and where he’s looking for investment opportunities today.

2015-03-21 00:00:00 ECRI Recession Watch: Weekly Update by Doug Short of Advisor Perspectives (dshort.com)

Today's new release of the publicly available data from the Economic Cycle Research Institute (ECRI) puts its Weekly Leading Index (WLI) at 131.1, down slightly from 131.6 the previous week. The WLI annualized growth indicator (WLIg) is at -3.7, up from the previous week's -4.0 and off its interim low of -5.0 in mid-January.

2015-03-21 00:00:00 The Fat Pitch Weekly Market Summary by Urban Carmel of The Fat Pitch

Strong price and breadth suggest the uptrend from the March low has further to go. A dip early in the week is a high probability buy set up. But gains from here are likely to be short lived; nibble traders may want to sell into strong gains on the expectation of weakness over the next month.

2015-03-20 00:00:00 The Declining Demand for Driving Vehicles by Doug Short (Article)

Paul Hodges, who writes a blog for ICIS.com on Chemicals and the Economy, recently sent me link to his fascinating study on the correlation between gasoline prices and the Department of Transportation's monthly statistics on vehicle miles driven. Paul offers a new perspective with a scatter chart showing the correlation between gasoline prices (vertical axis) and per-capita vehicle miles traveled on the horizontal axis.

2015-03-20 00:00:00 Northern Trust Perspective by Team of Northern Trust

The long-telegraphed launch of quantitative easing by the European Central Bank (ECB) has added some accelerant to financial market trends in place so far this year. European stocks, which had been strong performers in local currencies, have continued their strong performance while European bond yields have declined even further.

2015-03-20 00:00:00 Key Questions for China Investors in 2015—Part III by Andy Rothman of Matthews Asia

In this final installment of a three-part Sinology series, Andy Rothman, Matthews Asia Investment Strategist, answers the question: is China’s property market heading for a crash? He also discusses what he believes are the biggest long-term risks to growth and stability—an absence of the rule of law and trusted institutions.

2015-03-20 00:00:00 The student loan debt crisis revisited: For-profits come to the forefront by Leighton A. Hunley of Milliman, Inc.

Problems connected with high levels of student loan debt continue to make headlines. Today, the controversy centers around for-profit colleges, which, according to The Wall Street Journal, teach about 11% of higher education students, but whose students account for 44% of defaults on federal loans.

2015-03-20 00:00:00 Navigating Interest Rate Cycles with the Laddered Bond Portfolio by Josh Gonze of Thornburg Investment Management

The purpose of fixed income for most investors is to generate income and serve as ballast in their broader portfolios. It’s not meant to be the fastest boat in the water, but rather the most seaworthy. Since the global financial crisis, major central banks have kept interest rates at rock-bottom levels and provided abundant liquidity through asset purchase programs more commonly known as quantitative easing.

2015-03-19 00:00:00 De-risking Goes Beyond Interest Rate Risk: The Case for Dynamic Asset Allocation in an LDI Solution by Catherine LeGraw of GMO

In this piece, we introduce a measure of valuation risk, and demonstrate how rotating growth assets into a valuation-aware dynamic strategy can help to reduce risk, improve long-term returns, and help improve funded status in the case of a reversion to the mean.

2015-03-19 00:00:00 Muni market – Favorable environment remains in place by James Dearborn of Columbia Management

Municipal bond market volatility in early '15 may have investors wondering if they should sell today and lock in their gains from 2014. After 13 consecutive months of positive returns, the muni market turned negative in February and the first two weeks of March as interest rates rose. After such a long and strong run, it is not surprising that the muni market has taken a step backward. That said, we do not see reason to panic and continue to believe that the muni market remains on sound footing due to supportive market fundamentals and technicals, as well as our entrenched high tax environment

2015-03-19 00:00:00 Cabela’s: Little Room for Error by Jenny Hubbard of Diamond Hill Capital Management, Inc.

Through our research process, we attempt to identify actionable investment ideas, but we often conclude that a company does not present an immediate long or short investment opportunity. A decision not to invest in a company is valued just as much as a decision to invest in one, but we are always expected to stay current on our area of coverage in case conditions change.

2015-03-19 00:00:00 Patiently Waiting by Anthony Valeri of LPL Financial

The Fed faces a number of obstacles now and may require greater justification to suggest raising interest rates as soon as June. Bond market reaction to recent Fed meetings has been initially bearish but muted overall. Maintaining the word “patient” could have different implications for segments of the bond market.

2015-03-19 00:00:00 Dollar Strength is a Symptom, Not a Cause by Burt White of LPL Financial

We do not think the strong U.S. dollar will derail the bull market. The dollar itself is not a key driver of market performance; it is a symptom.

2015-03-19 00:00:00 Growth in the Euro Zone: Europeans Consuming Again by Laura Sarlo of Loomis Sayles

Euro area growth appears set to outperform in 2015, thanks in part to a stronger consumer. Consumers are feeling more confident about their own economies, and in some spots, job growth and wage increases provide an additional boost. Here are some of the major consumer trends I have noticed across the euro zone.

2015-03-19 00:00:00 Dropping the "Patient" Word Does Not Mean the Fed Is "Impatient" by Team of Northern Trust

Markets sometimes hang on every word from the Federal Reserve. In recent weeks, they had been hanging on a single word: “patient.” This term had been used to describe the prospective approach to policy tightening in recent statements; analysts speculated that removing the term would be a strong signal that rates would be heading up soon.

2015-03-19 00:00:00 Merk Analysis: How to Diversify When the Fed Out of Patience? by Axel Merk of Merk Funds

The S&P 500 has more than tripled in six years, just like in 1929 and 1999-2000. What could possibly go wrong?

2015-03-19 00:00:00 Could India “Run the Table” like China by Jeremy Schwartz of WisdomTree

Jeremy Schwartz had the opportunity to speak with Rob Lutts, CIO of Cabot Wealth Management, a client of WisdomTree, about a research trip to India he had just taken. India has been a standout among emerging market countries, and Lutts’ outlook is that India remains a very attractive place to allocate part of his growth portfolio capital.

2015-03-19 00:00:00 Yellen Loses "Patience," But Maintains Flexibility by Brian S. Wesbury and Robert Stein of First Trust Advisors

The Federal Reserve is no longer committed to being “patient” before it starts raising rates. In Fed-speak, that means it will actively consider raising rates starting in two meetings, which will be in mid-June.

2015-03-19 00:00:00 10 Investment Quotes To Live By by Lance Roberts of Streettalk Live

As markets hover near all-time highs, investors have become quite complacent that the current bull market trend will continue indefinitely. But why shouldn't they? After all, the Central Banks of the world have made it a primary mission to ensure that asset prices don't fall in order to keep extremely weak economies limping along.

2015-03-19 00:00:00 Proposed Changes to U.S. Bankruptcy Code Could Create Opportunities in Distressed Credit by Sai S. Devabhaktuni, Ethan Schwartz of PIMCO

The American Bankruptcy Institute's (ABI) proposals aim to balance the objectives of effective reorganization of debtors and the maximization of asset values for all creditors and stakeholders. The proposals seem to mark an effort to modify the positions of different creditor classes in bankruptcy, a move that could disadvantage both senior and junior creditors depending on the particular case.

2015-03-19 00:00:00 Riding a Wave of Accommodation by Richard Clarida, Andrew Balls of PIMCO

PIMCO’s quarterly Cyclical Forum was held earlier this month to evaluate and assess the state of the global economy, to reach consensus on the near-term macroeconomic outlook, and to explore the tail risks to that outlook.

2015-03-19 00:00:00 Meet the world’s worst economic forecasters – The Fed by Lance Roberts of Streettalk Live

I have been tracking the Federal Reserves forward looking projections ever since they begin releasing their forecasts. The purpose of tracking these projections was to compare the Fed's forecasts with what eventually became reality. The record is now clear...they are the worst economic forecasters...ever.

2015-03-18 00:00:00 Curse of the Brilliant Client by David Edwards of Heron Financial Group

What do I say when clients think they know more than I do? At my firm, we work with executive families. Our clients are brilliant; many have advanced degrees from top universities. These clients have ascended to the pinnacles of their careers and are accustomed to being the smartest person in the room.

2015-03-18 00:00:00 The Surging U.S. Dollar - Good For Some, Bad For Others by Gary Halbert of Halbert Wealth Management

The US dollar has been surging against most other currencies over the last year. The question is, is the rising US dollar good for the economy and the investment markets, or not? No doubt, the rising dollar has been buffeting the US equity and bond markets this year and is increasingly cited as the main culprit. That is what we will delve into today.

2015-03-18 00:00:00 How Far Will the Euro Fall? by Anatole Kaletsky of Project Syndicate

The US dollar is hitting new 12-year highs almost daily, while the euro seems to be plunging inexorably to below dollar parity. But there are plenty of reasons to believe that the exchange-rate trend may already be overshooting.

2015-03-18 00:00:00 Alpha Matters More in Muted Equity Markets by Chris Marx of AllianceBernstein

In a Wall Street Journal article last week, financial advisors described how exuberant investors had unrealistic expectations for stock market returns after a six-year rally. We think a more pragmatic approach should aim to beat a slower-paced market in an effort to capture compounding returns.

2015-03-18 00:00:00 Keep it Simple: India is Outperforming Because Oil is Crashing and Inflation is Tame by Team of GaveKal Capital

India has for years battled high levels of inflation which has in many ways kept the country from realizing its full economic potential. Over the last year though, basically since the price of oil stopped going up, Indian inflation has remained tame. As global growth has continued to muddle through, the further collapse of the price of oil has been a major tailwind for India since global growth has not collapsed in lockstep.

2015-03-18 00:00:00 Global Economic Perspective: March by Franklin Templeton Fixed Income Group® of Franklin Templeton Investments

IN THIS ISSUE: United States Prepares for Interest-Rate Hikes; But Much of the World Is Still in Monetary Easing Mode; European Outlook

2015-03-18 00:00:00 WSJ Economists' Forecasts for 10-Year Yields and the Fed Funds Rate by Doug Short (Article)

The big economic news today will start the statement from the Federal Open Market Committee at 2 PM ET and followed by Janet Yellen's press conference 30 minutes later. The economic press has been a veritable cacophony pundit views on whether the word "patient" remains or is discarded in the new statement. Here is the key sentence in the previous statement (emphasis added).

2015-03-17 00:00:00 Gundlach - Don't Bet on Higher Rates by Robert Huebscher (Article)

Even if the Fed raises short-term interest rates as many expect it to, longer-term bond investors won't face a decline in prices, according to Jeffrey Gundlach. Indeed, the market may have already priced in the effect of rate hikes, he said.

2015-03-17 00:00:00 Prognosis Excellent for Health Care by Sponsored Content from Invesco (Article)

Three years of outperformance is rare; a fourth would be unprecedented. Parts of the health care sector are more defensive, but opportunities to outperform exist even in an up market. Biopharmaceutical pipelines, M&A activity and reform will help drive longer-term health care outperformance.

2015-03-17 00:00:00 How Advisors Are Positioning Fixed-Income Portfolios by Bob Veres (Article)

I asked the readers of my Inside Information newsletter service to tell me how they're preparing for an impending Fed rate hike. To date, I've received 178 pages of responses from advisors all over the country and across the spectrum, from indexers to fervent believers in active management, representing large and small firms investing on behalf of wealthy or middle-income clients.

2015-03-17 00:00:00 MLPs Will Weather the Storm by Sponsored Content from ClearBridge Investments (Article)

A significant decline in oil prices has led to increased MLP volatility. However, their fundamentals remain robust. Our latest white paper examines the economics of the U.S. oil and natural gas markets and their impact on the outlook for MLPs.

2015-03-17 00:00:00 Do Liquid Alts Justify Their Costs? by Robert J. Martorana, CFA (Article)

Liquid alts are complex and expensive, so it is natural for advisors to ask if they worth the time and trouble. In this article, I answer this question. I evaluate returns with special emphasis on 2014, when managed futures (notably the AQR Managed Futures Strategy Fund - AQMIX) soared and the largest global macro fund, MainStay Marketfield (MFLDX), stumbled.

2015-03-17 00:00:00 The Skill Set for Exceptional Performance by Dan Richards (Article)

Once you have built an initial client base, you face a very different set of challenges to take your practice to the next level. Overcoming that challenge boils down to identifying and cultivating the skill set needed for exceptional performance - and that's building and managing a high-performance team.

2015-03-17 00:00:00 How to Deal with High-Anxiety Clients by Daniel Solin (Article)

This is not an easy time to be an investor. Market volatility, often represented in the financial media through triple-digit gyrations in the Dow), creates understandable anxiety. Here's how to assess the source of your clients' anxiety and some tips for easing it.

2015-03-17 00:00:00 Bounded Rationality, Unbounded Confidence by Baijnath Ramraika, CFA® and Prashant Trivedi, CFA® (Article)

Our rationality is limited by the information we have, the cognitive limitations of our minds and the finite amount of time we have to make a decision. Herbert A. Simon called that concept "bounded rationality." As a consequence of these limitations, our confidence becomes unbounded. We will discuss the implications of this phenomenon and how investors can overcome it.

2015-03-17 00:00:00 The Art of Pension Hopping by Antolin Du Bois, CFP® (Article)

Clients who are unlikely to complete a traditional 30-year defined-benefit pension and are willing to pursue an un-orthodox strategy of switching work locations, continually re-purchasing prior service completed in another location will increase their work options, their retirement security and their overall pension income.

2015-03-17 00:00:00 How to Get Your Team to Use Your CRM by Beverly Flaxington (Article)

After a lengthy search, my staff and I agreed on a CRM system and paid for consulting and installation. Now we have installed it, but no one is using it. They offer excuses: it is unwieldy or they don't have the time. How do I get them to use the system that they asked for in the first place?

2015-03-17 00:00:00 Monetary Policy Concerns Continue to Weigh on Markets by Robert Doll of Nuveen Asset Management

Investors continued to focus on global monetary policy last week. The divergence between the start of the European Central Bank’s quantitative easing program and the pending shift in the Federal Reserve’s policy stance caused the euro to fall, the U.S. dollar to rally and acted as a drag on U.S. equities. Concerns over a weakening corporate earnings environment acted as an additional headwind for stock prices. the S&P 500 Index declined 0.8% for the week.

2015-03-17 00:00:00 The Messy Politics of Economic Divergence by Mohamed El-Erian of Project Syndicate

The world is increasingly characterized by divergence – in economic performance, monetary policy, and thus in financial markets. Though there is a broad consensus on what must be done to rebalance the global economy, political leaders remain unwilling to fulfill their economic-governance responsibilities.

2015-03-17 00:00:00 Resist the Rate-Hike Huff by Brian Wesbury, Robert Stein of First Trust Advisors

In June 2013, then-Federal Reserve Chair Ben Bernanke hinted the time to “moderate” quantitative easing was approaching. The press called this “tapering”. The Fed would end QE gradually, by slowly shrinking its asset purchases rather than going cold turkey.

2015-03-17 00:00:00 FOMC Preview: When, How Often, and How Much by John Canally of LPL Financial

What the FOMC says, if anything, about the rising dollar and its implications, could have ramifications for monetary policy over the next several quarters and beyond. In addition to “when,” market participants may start asking “how much” and “how fast” rates may increase once the Fed begins to raise the rates. We are watching several factors to gauge when the Fed may begin to hike rates, including wages, the output gap, inflation, and inflation expectations.

2015-03-17 00:00:00 The New World Order: Part I by Bill O'Grady of Confluence Investment Management

We have focused for several years on the issue of the uncertainty surrounding America’s superpower role. It has been our position that the U.S. has lacked a coherent foreign policy since the Cold War ended in the early 1990s. Although we cannot definitely say that a new policy is in place, the trappings of one appear to be emerging. The focus of this paper is how policy seems to be evolving and why. This will be a four-part report. Part I begins with the evolution of U.S. foreign policy, focusing on the 25-year cycle pattern between the adaptations to new circumstances.

2015-03-17 00:00:00 Japan: Why Stagnation Is the "Abe Normal" by Milton Ezrati of Lord Abbett

Until the prime minister draws the "third arrow"—structural reform—from his quiver, Japan's economic and investment prospects will remain limited.

2015-03-17 00:00:00 The 11-Year Itch: Waiting for the Fed to Act by Jon Denfeld of AllianceBernstein

It was 2004: the New England Patriots won their second Super Bowl, Facebook was launched and the US Federal Reserve raised interest rates for the first time in four years—the start of a two-year cycle of rate hikes. To markets, it seems like a distant memory.

2015-03-17 00:00:00 The Airline Industry Ascended to New Records in 2014 by Frank Holmes of U.S. Global Investors

Just as the U.S. economy is in full-recovery mode, so too is the airline industry. It’s lately made an impressive about-face from only a decade ago and, in 2014, soared to several new benchmarks.

2015-03-17 00:00:00 Waiting for the Squirrel by Jerry Wagner of Flexible Plan Investments

Spring has finally begun to show itself here in Michigan. It has been a brutal winter. Molly, our six-year-old, loveable mutt (of “Where’s Molly” fame), loves the new freedom that warmer weather brings. She bounds from the door each chance she gets and instead of the quick return that the winter’s cold elicited, she is gone for hours. Where does she go? First there is a quick reconnaissance of the property, carefully sniffing every square inch it seems. Then, she’s caught the scent. A flash of movement catches her eye. It’s her arch nemesis - the squirrel.

2015-03-17 00:00:00 Should You Buy in to Oil’s Secular Bear Market? by William Smead of Smead Capital Management

March 10th is one of my favorite days of the year. The tech bubble of the late 1990's burst on March 10th of 2000 and the biggest bear market of my career (2007 peak to 2009 low) bottomed on March 10th of 2009. There is a great deal to learn from those two dates in history as it pertains to the way secular bear markets work and how long it takes to move from the most popular investment in the world to being completely out of favor.

2015-03-16 00:00:00 Extremes in Every Pendulum by John Hussman of Hussman Funds

Whether or not it is fully appreciated, we are observing extremes in nearly every pendulum of the global financial markets. The situation is likely to be seen in hindsight as one of the broadest points of financial distortion in history.

2015-03-16 00:00:00 How Scary Is the Bond Market? by Robert Shiller of Project Syndicate

With the bond market appearing ripe for a dramatic correction, many are wondering whether a crash could drag down markets for other long-term assets, such as housing and equities. But when an event has never occurred, it cannot be predicted with any semblance of confidence.

2015-03-16 00:00:00 Welcome to the World of Taxes! A Philosophical Introduction for New Taxpayers by Francois Sicart of Tocqueville Asset Management

In his latest piece, Francois Sicart, Founder and Chairman of Tocqueville Asset Management, discusses his philosophy on taxes for the high net worth, especially from an international perspective.He notes "two waves" of investors who are new to tax planning.

2015-03-16 00:00:00 This Too Shall Pass by Scott Minerd of Guggenheim Partners

Behavioral finance reminds us that ignoring daily volatility roiling the market is wise. Instead, investors should focus on the positive, fundamental outlook for equities and fixed income.

2015-03-16 00:00:00 Should Greece Stay or Go? by Jeremy Schwartz of WisdomTree

Professor Jeremy Siegel and I spoke with University of Texas professor James Galbraith on February 27. Professor Galbraith has an inside look on the ongoing Greek debt dynamics, as he became friendly with the current Greek finance minister Yanis Varoufakis as a colleague at the University of Texas.

2015-03-16 00:00:00 An Overview of Nontraditional Assets by Michael Winchell of Larkin Point Investment Advisors LLC

We review a collection of nontraditional assets and acknowledge the growing attempts to offer more liquid instruments with market exposure to these assets. However, it is our opinion that these assets will ultimately represent a small portion of the overall allocation to alternative investments.

2015-03-16 00:00:00 On My Radar: Rate Hike Ahead, Bond Model Says Sell by Steve Blumenthal of CMG Capital Management Group

I wrote a piece in Forbes this week titled “Rate Hike Ahead, Bond Model Says Sell”. The gist of the piece is about a tug of war between opposing views on the direction of interest rates. The outcome of this contest will enrich some and demoralize others.

2015-03-16 00:00:00 Ingredients Missing for a Turnaround in Brazil by Russ Koesterich of BlackRock

Brazil has struggled in the past years, bogged down by unfavorable economic conditions including a collapse in growth. A recovery would hinge upon some much needed structural reforms.

2015-03-16 00:00:00 Brazil: Macro Headwinds Are Strengthening by Sean Newman of Invesco Blog

Invesco Fixed Income’s outlook on Brazil as a sovereign credit is deteriorating. Downside risks to growth have increased given the country’s deteriorating fiscal position, rising interest rates, lower commodity prices, global growth headwinds, water and electricity shortages, among other challenges. The key for markets, in our view, will be the administration’s ability to deliver on promised fiscal adjustments.

2015-03-14 00:00:00 The Fat Pitch Weekly Market Summary by Urban Carmel of The Fat Pitch

Our overall view continues to be that 2015 will not be like 2013 or 2014. This is a year where fundamentals improve while equity prices mark time, allowing sentiment and valuation to fall back inline. This is a common pattern: large parts of 1994, 1996, 1998, 1999, 2004 and 2005 were similar. That November and December were the first back to back down months in 3 years bears out the change in character.

2015-03-14 00:00:00 Ingredients Missing for a Turnaround in Brazil by Russ Koesterich of BlackRock

Brazil has struggled in the past years, bogged down by unfavorable economic conditions including a collapse in growth. A recovery would hinge upon some much needed structural reforms.

2015-03-14 00:00:00 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

China Moves Cautiously Toward a New Normal; Deleveraging Is Unfinished in the Industrialized World; Will Lower Borrowing Costs in Europe Be a Boon for U.S Firms?

2015-03-14 00:00:00 The Airline Industry Ascended to New Records in 2014 by Frank Holmes of U.S. Global Investors

Just as the U.S. economy is in full-recovery mode, so too is the airline industry. It’s lately made an impressive about-face from only a decade ago and, in 2014, soared to several new benchmarks. This industry is flying high again.

2015-03-14 00:00:00 The U.S. Dollar: Is Strength a Weakness? by Jim McDonald of Northern Trust

The U.S. dollar has seen strong upward moves in the past 9 months. What would continued dollar strength mean for economic growth, earnings and asset class performance? Find out more in Jim McDonald's latest strategy piece.

2015-03-14 00:00:00 Will Dipping Data Lead To Dramatic Drop? by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

US stocks have been resilient, although there has been an uptick in volatility. Economic data has shown some softening, but we believe it is temporary in nature. However, the risk of a correction is elevated in our view and investors should be prepared for such a possibility by having a diversified portfolio and keeping a close eye on rebalancing opportunities after pullbacks. Meanwhile, investors should also look overseas for global diversification opportunities as monetary policy easing should help to bolster asset values.

2015-03-13 00:00:00 Prospect of U.S. Fed Hike & its Effect on Asian Assets, Part I by Gerald Hwang of Matthews Asia

How close are we to a U.S. Federal Reserve (Fed) rate hike? How would a hike affect Asian securities? These are the questions we explore in this two-part series of Asia Insight.

2015-03-13 00:00:00 Equities: Enhancing the Core/Satellite Framework by Sabrina Callin, Andrew Pyne of PIMCO

?In a lower-returning environment, investors may need to look beyond traditional active or passive approaches in order to capture equity alpha. The “building blocks” of equity alpha include high active share stock selection, smart beta-based strategies and portable alpha approaches. These complementary sources of alpha can be implemented in an enhanced core/satellite framework to allow investors to pursue the returns needed to meet their objectives.

2015-03-13 00:00:00 Charting The Winners And Losers Of The Latest Surge In The USD by Team of GaveKal Capital

On March 4th we wrote in The Dollar Is Breaking Out Again And What It Means For Stocks that "for a variety of cyclical and structural reasons...stocks in North America tend to be the relative beneficiary of USD strength while stocks in other regions generally, but not always, tend to underperform. The negative correlation is especially strong for European stocks." Well, since then the USD has surged another 6% so we thought we'd review how things have played out.

2015-03-13 00:00:00 Could the Search for Income Lead to Instability? by Daniel Loewy, Morgan Harting of AllianceBernstein

Years of quantitative easing has pushed yields on government bonds down to record lows, and income-starved investors are being pushed out the risk spectrum, forced to choose between more volatile assets to find income. Finding acceptable levels of income exposes portfolios to greater instability ahead—we believe a multi-asset approach can help.

2015-03-13 00:00:00 Big Government, Little Buns by Brian Wesbury, Robert Stein of First Trust Advisors

You’re kidding, right? It’s 2015. How can a populated country run out of bread? It would be understandable if a natural disaster or devastating war caused a shortage, but neither of these is happening in Venezuela – and they seem to be running out of bread. Why? Well, Socialism, of course.

2015-03-13 00:00:00 Keep it Short? The Limited-Term Fixed Income Market by Mark Otterstrom, Susan Regan of Ivy Investment Management Company

Concern about interests rates has made fixed income investors more aware of the potential for interest rate risk – or the risk that a rise in rates will reduce the value of their longer-maturity securities. This risk, which is often expressed as a bond or bond fund’s “duration,” has led some investors to consider investments believed to have less potential risk. These securities, which are considered to have a lower duration, are seen as less vulnerable to market volatility.

2015-03-12 00:00:00 Great Advice from Bill Bernstein by Roger Nusbaum of AdvisorShares

Investing/indexing legend Bill Bernstein was interviewed by ETF.com and had a couple of great nuggets that are useful for any type of investor and helpful for advisors’ communication with their clients.

2015-03-12 00:00:00 Is a New U.S. Bear Market Hanging Over Our Head? by Robert Lamy of The Forecasting Advisor

The current bull stock market is now six years old and it will start its seventh year on March 9th. As of March 6th, the S&P 500 stock price index has risen by 206% from the last bear market through of March 9th, 2009. This gain implies that the current bull market recorded a larger increase and rose for a longer period than most of the previous bull markets over the past fifty years.

2015-03-12 00:00:00 Beige Book Suggests Continued Modest Economic Growth by John Canally of LPL Financial

The latest Beige Book suggests that the U.S. economy is still growing at a “modest or moderate” pace that is at or above its long-term trend, and that some upward pressure on wages is beginning to emerge. Optimism on Main Street remains high despite the recent barrage of bad news on the economy. Over the past three Beige Books, the BBB averaged +85, in-line with the +89 average reading in all of 2014.

2015-03-12 00:00:00 Global Macro Framework by Alexander Giryavets of Dynamika Capital L.L.C.

Global Carry, Yen and Dollar are irrefragable drivers of Global Macro. As we explain equities and bonds are just derivatives of these factors. We expose how the big picture asset dynamics worked since the GFC, brief on what happened over the last year and conclude with comments on dollar blowout over the past week.

2015-03-12 00:00:00 Pop Quiz: What Is The Best Performing Regional Sector YTD? by Team of GaveKal Capital

The recent focus of the financial world (including for us) has been on the massive currency moves going on in the forex markets. By this point, everyone and their grandma knows that the US dollar has been on an explosive move higher. Since we are in a stronger US dollar environment now that must mean the US stock market has been outperforming in US dollar terms, correct? Not so fast.

2015-03-12 00:00:00 Cutting Through the Currency Fog by Mark Phelps, Dev Chakrabarti of AllianceBernstein

With the euro sliding deeper against the dollar this week, equity investors have been getting nervous. But why is everyone so surprised when known currency fluctuations derail earnings? In our view, a sharper focus on company exposures can help create a “natural” currency hedge in global equity portfolios.

2015-03-11 00:00:00 A Patient Fed Considers Losing Patience by Peter Schiff of Euro Pacific Capital

I have always argued that quantitative easing and zero percent interest rates were misguided policies to combat economic weakness. But as the years went on, misguided turned into irresponsible, which led to ridiculous, and then turned into dangerous. But lately, the only word that comes to mind is "surreal." How should we react when central bankers begin to speak like Willie Wonka?

2015-03-11 00:00:00 Strong Jobs Report Hits Fed's Rate-Hike Target Zone by Gary Halbert of Halbert Wealth Management

Last Friday’s unemployment report for February was stronger than expected, both in terms of new jobs created and the headline unemployment rate which fell from 5.7% to 5.5%. This sparked growing fears among investors that the Fed will move to raise short-term interest rates sooner rather than later. Stocks fell sharply just after the report.

2015-03-11 00:00:00 Metals May Have an Evil Intent by Avi Gilburt of ElliottWaveTrader.net

From an anecdotal sentiment perspective, before I go into this week’s analysis, I would like to give you a little feedback from this year’s Prospectors and Developers Association of Canada (PDAC) annual convention. I was honored at being a featured speaker there this year, and discussed how I viewed us as being on the cusp of the next great bull market in the investment world. But, the most common comment I received from all those with whom I spoke was that the attendance had been quite underwhelming.

2015-03-11 00:00:00 The Expansion Settles, but Its Foundation Is Strong by Team of Northern Trust

Growth in the U.S. economy tapered a bit in the fourth quarter, but the outlook ahead remains very positive. Real gross domestic product (GDP) grew 2.2% in the fourth quarter after a 5.0% increase in the third quarter, but some special factors were at play that should ease as the first quarter of 2015 winds down.

2015-03-11 00:00:00 Worries about the Looming Fed Hike Spill Over by Russ Koesterich of BlackRock

Many investors are anxious about a possible bubble in stock markets, but those fears seem overblown to us. The greater near-term danger may be a more aggressive Federal Reserve.

2015-03-11 00:00:00 A Contrarian Case for Brazil by Mark Mobius of Franklin Templeton Investments

Many investors in Brazil, including us, have been a little frustrated over the past couple of years with its lack of growth and progress. Gross domestic product (GDP) in Brazil grew a mere 0.2% in 2014 (estimated), a far cry from the 7.5% it saw in 2010. However, we believe Brazil has all the elements in place to achieve much higher rates of growth if the political will is there.

2015-03-11 00:00:00 The Market Is Pricing In Two Rate Hikes In 2015 (And Four In 2016) by Team of GaveKal Capital

According to Fed Fund futures, the market currently expects about 2 rate hikes by December 2015 (assuming the Fed raises rates by 25 basis points each time). Fed Funds futures is pricing the Fed Funds Rate at 54 basis points by December 2015. The market was most optimistic regarding delaying fed hikes in mid-January when the market was pricing in only about one and half hikes for 2015.

2015-03-11 00:00:00 Optimal Diversification Portfolio for Upcoming Interest Rate Environment by Chuck Self of iSectors

Historical patterns in interest rates leading to the current trend; Macroeconomic activity supporting future rising interest rates; Recommendations for optimizing client portfolios in such an environment

2015-03-10 00:00:00 A Warning Sign from the Latest Wage Data: Update by Doug Short (Article)

Note from dshort: I've added a second chart to show the correlation between hourly earnings and inflation.

Over the weekend, my virtual friend and occasional correspondent New Deal Democrat requested some assistance on visualizing Average Hourly Earnings of Production and Nonsupervisory Employees.

2015-03-10 00:00:00 The Hidden Peril in Sequence of Returns Risk by Wade Pfau (Article)

Should retirees place greater faith in stocks' ability to outperform bonds over reasonable holding periods or in insurance companies and bond issuers' ability to meet their contractual guarantees? Your position on this fundamental question will determine how you choose to build retirement income strategies for your clients.

2015-03-10 00:00:00 Curiouser and Curiouser... by Sponsored Content from Legg Mason (Article)

Though historically low, U.S. interest rates are actually high in comparison to the rest of the developed world. U.S. bonds appear overpriced on domestic fundamentals, but they are a bargain based on global valuations.

2015-03-10 00:00:00 America's China Codependency by Michael Edesess (Article)

The massive Chinese investment in Treasury securities helps keep interest rates extremely low. This hugely increases the incentive for Americans to borrow. All that is needed is "collateral," and Americans will go out and borrow to their hearts' content and buy Chinese goods.

2015-03-10 00:00:00 What Advisors Can Learn from Bernie Madoff by Dan Richards (Article)

Few advisors would admit that they have anything to learn from Bernie Madoff. But setting the obvious ethical issues aside, advisors can still learn from the most notorious con artist of our generation.

2015-03-10 00:00:00 'Cheating' for Alpha with Beta by Ryan J. Lehman (Article)

In a recent white paper, our colleagues at GMO very appropriately asked, "Is Skill Dead?" In this paper they examined the results of the large-cap blend peer group, and offered an optimistic outlook for active managers despite recent underperformance. In this article, I expand upon their work and our own by discussing how managers "cheat" for alpha by taking positions in out-of-benchmark risk premia and beta exposures, and how those bets have compromised recent results.

2015-03-10 00:00:00 Use "Self-Distancing" to Make Better Decisions by Daniel Solin (Article)

Before I became a consultant and coach to a number of financial planning firms, I used to run my own investment advisory firm. I believe the advice I give today is far superior to the actions I took when I managed my own firm. Now I understand why.

2015-03-10 00:00:00 President Obama's 2016 Federal Budget Proposal by Tim Steffen (Article)

Both parties are focused on passing some type of tax reform this year, and in order to do that Republicans will likely have to concede on at least some of the president's wishes. Which of those may survive remains to be seen, but it's now up to the Republicans in Congress to respond with a proposal of their own.

2015-03-10 00:00:00 How to Make a Graceful Departure by Beverly Flaxington (Article)

I can't seem to find the magic conditions to make it worth my while to create a succession plan and retire. What advice do you have that might push me to finally figure out how to make a graceful departure?

2015-03-10 00:00:00 Stranded in NYC by Jeffrey Saut of Raymond James

The week began well enough as I arrived Sunday a week ago in Orlando for the 36th annual Raymond James Institutional Investors conference. As previously stated, there were more than 1,000 portfolio managers (PMs) and analysts there to listen to some 300 companies’ presentations. In addition to the PMs and their analysts, our analysts anchored the presentations by the CEOs and CFOs of those companies.

2015-03-10 00:00:00 February Employment Report - Is It Enough? by Scott Brown of Raymond James

Job growth remained strong in February, leading financial market participants to believe that the Fed will begin to raise short-term interest rates sooner (June) rather than later (September) and, more importantly, at a faster pace than thought earlier. The report is only one item that the Fed will consider when it meets to set monetary policy (March 17-18).

2015-03-10 00:00:00 Good News is Still Good News by Brian Wesbury, Robert Stein of First Trust Advisors

The stock market sold off hard last Friday and the reason looks clear: job creation was stronger than the consensus expected in February, the fourth straight month of upside surprises in payrolls.

2015-03-10 00:00:00 On My Radar: Rut Ro Rastro by Steve Blumenthal of CMG Capital Management Group

At the beginning of each month, I like to look at a series of valuation metrics: Median PE, Price to Sales and Price to Operating Earnings. Let’s look at them today. The logic, of course, is simple. When expensively priced, reduce exposure and reduce return expectations. When inexpensively priced, overweight exposure and increase return expectations. Let’s also take a look at what has been driving the market higher. Some argue that individual investors are still on the sidelines. I don’t think so and I show evidence that they are almost as fully invested as they were at the 2000 and

2015-03-10 00:00:00 The 6th Anniversary of 676 by David Edwards of Heron Financial Group

On March 9th, 2009, the S&P 500 made an intra-day and 20 year low at 676.53. Millions of Americans drew a straight line from the mid-September 2008 failure of Lehman Brothers through that March low and projected that the S&P 500 would be zero by June. Armed with that projection, average investors liquidated hundreds of billions of dollars in stock investments, never to return. Those investors will never be able to retire.

2015-03-10 00:00:00 Will Dow Jones Become the Last Buyer of Apple? by Jerry Wagner of Flexible Plan Investments

Spring arrives in the northern hemisphere this month. Its appearance holds various connotations to different people, although my unscientific poll of a few random individuals leads me to believe the majority of the population has a positive bias toward its arrival. Daylight Savings Time has already kicked in, and soon winter’s frozen landscapes thaw, daylight hours lengthen, flowers bloom, and the frequency of outdoor activities increases. Ah, spring time!

2015-03-10 00:00:00 Stock and Bond Funds Grow with the Flows by Milton Ezrati of Lord Abbett

No redistribution here: Even as equity fund flows have turned positive, bond funds continue to see inflows. Here’s a closer look at the trend—and what it means for investors.

2015-03-10 00:00:00 Happy Birthday Bull Market by Burt White of LPL Financial

The current bull market celebrates its sixth birthday today (March 9, 2015). Bull markets do not die of old age, they die of excesses, and we do not see evidence of excesses emerging today. Some of our favorite leading indicators suggest the economic expansion and bull market may continue through the end of 2015.

2015-03-10 00:00:00 Good luck, Jonathan. Good luck, Nigeria. by Kaisa Stucke of Confluence Investment Management

This week we look at the upcoming Nigerian presidential election and how the persistent threat of the Boko Haram terrorist movement has complicated the democratic process. The election promises to be a close one between the incumbent, Goodluck Jonathan, and a former military leader, Muhammadu Buhari. In turn, we look back at the 2011 presidential election and analyze how that election facilitated the rapid spread of Boko Haram. Exacerbating matters further, the country suffers from a deepening divide between the Christian south and the Islamic north, which we discuss in detail in this report.

2015-03-10 00:00:00 Q&A with Jeff Knight: What’s in store for 2015? by Jeff Knight of Columbia Management

I believe we are still going through a process that is flattering to financial market returns. But after six years and a tripling of the stock market, recognize that we're getting late in the game. Does Europe hang together? Do events in the Ukraine or Greece disrupt the economic recovery in Europe? Is the Fed’s tightening appropriate, or does it represent a threat to financial markets? Will those who come out on the short end of oil’s dramatic repricing emerge as a threat to capital markets either through default and bankruptcies, or worse through geopolitical tensions?

2015-03-10 00:00:00 Why Holding Cash May Mean Losing Money by Russ Koesterich of BlackRock

There are many reasons to hold cash in your portfolio, but sometimes it can be too much of a good thing. Russ Koesterich explains the risks of a large cash position and offers some alternatives.

2015-03-10 00:00:00 Never Smile at a Crocodile by John Mauldin of Mauldin Economics

We will briefly survey my worry closet today before resuming our series on debt, in which we’ll encounter Paul Krugman’s lament that “Nobody understands debt.”

2015-03-09 00:00:00 What Does That Difference Mean? by John Hussman of Hussman Funds

The difference between actual market returns over a given time period, and the returns that one would have projected earlier based on reliable valuation measures, is extremely informative about where current valuations stand, and about where future market returns are headed.

2015-03-09 00:00:00 ISM Data for January and February Point to Modest U.S. Real GDP Growth in 2015 Q1 by Robert Lamy of The Forecasting Advisor

At the start of each month, the U.S. Institute for Supply Management (ISM) released data on the state of the manufacturing and non-manufacturing industries of the U.S. economy. The data are closely followed by economists, stock market brokers, and the media as they provide the earliest reading on the current state of the economy.

2015-03-09 00:00:00 Recession Probability Models - March 2015 by Ted Kavadas of StratX, LLC

There are a variety of economic models that are supposed to predict the probabilities of recession. While I don’t agree with the methodologies employed or probabilities of impending economic weakness as depicted by the following two models, I think the results of these models should be monitored.

2015-03-09 00:00:00 An Overview of Alternative Investments by Michael Winchell of Larkin Point Investment Advisors LLC

If you have been thinking about adding alternative investments to your clients’ portfolios, it’s important to step back and analyze the various types of investments available to you—which, despite being lumped together in the same category, have become increasingly varied.

2015-03-09 00:00:00 The Stock-Bond Disconnect by Kenneth Rogoff of Project Syndicate

How should one understand the disconnect between the new highs reached by global equity indices and the new depths plumbed by real interest rates worldwide? Several competing explanations attempt to reconcile these trends, and getting it right is essential for calibrating monetary and fiscal policy appropriately.

2015-03-09 00:00:00 The Dollar isn’t the Peso anymore (Part II) by Richard Bernstein of Richard Bernstein Advisors

The US dollar rally is in its seventh year and we expect this trend to continue. Many observers, including the Fed, continue to worry about inflation. However, we think a strong USD and disinflation/deflation seem more likely than inflation so long as global overcapacity forces nations to fight for market share and depreciate their currencies.

2015-03-09 00:00:00 Personalized Risk Management: Helping Clients Make Smarter Decisions about Their Money by Patty Quinn McAuley of Clark Capital Management Group

Patty writes about helping clients achieve successful investment outcomes and about communicating effectively with clients.

2015-03-09 00:00:00 Tracking the Market with Social Media by Blair Jensen of Trade Followers

Last week we highlighted several signs coming from Twitter that a short term top was in the making. One of them was Twitter momentum for the S&P 500 Index (SPX) turning down from over bought levels and at the same time creating a negative divergence. This week momentum is warning that the selling we saw last week will most likely continue. After painting a negative divergence, 7 day momentum has broken its newly formed uptrend line. This suggests that investors and traders are not committed and were quick to exit positions established during the February rally.

2015-03-09 00:00:00 Why Is the Fed’s James Bullard Optimistic about the U.S. Economy? by Jeremy Schwartz of WisdomTree

On February 20, Professor Jeremy Siegel and I had the pleasure of speaking to St Louis Federal Reserve Bank (Fed) president James Bullard, who is a member of the Fed monetary policy committee. 2015 is shaping up to be an interesting year for monetary policy, with the Fed expected to hike interest rates.

2015-03-08 00:00:00 Weighing the Week Ahead: Is Good News Now Bad for Investors? by Jeff Miller of New Arc Investments

Anyone who wants to speculate on what the Fed is thinking must include some actual evidence from past transcripts. If, for example, you want to suggest that the Fed “wants a market correction” (you can’t make this stuff up) then you have to find at least one historical example where some participant raised that idea. Otherwise, shut up!

2015-03-07 00:00:00 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Quantitative easing comes to the eurozone; U.S. job growth is strong, but wage growth is not; The California port strike has troubled trade... and economists

2015-03-07 00:00:00 The Strong USD Is Negatively Impacting US Trade by Team of GaveKal

Exports have been a solid contributor to US GDP growth for the last few years, while consumption and residential investment have been more restrained. Recently, with consumption firming and likely to improve further from the tail-wind of lower oil prices, and exports faltering, it appears the drivers of the US economy are trading places. It appears that we should expect trade to subtract from growth in the coming quarters.

2015-03-07 00:00:00 The Search for a Low Expense Ratio Ends Here by Rob Isbitts of Sungarden Investment Research

The investment of the decade is not mutual funds or ETFs. It is individual stocks. You may just not realize it yet.

2015-03-07 00:00:00 ECRI Recession Watch: Weekly Update by Doug Short of Advisor Perspectives (dshort.com)

Today's new release of the publicly available data from the Economic Cycle Research Institute (ECRI) puts its Weekly Leading Index (WLI) at 130.6, unchanged from the previous week. The WLI annualized growth indicator (WLIg) is at -4.6, down from the previous week's -4.5 but off the interim low of -5.0 in mid-January.

2015-03-07 00:00:00 The Official Unemployment Rate is Meaningless by Steve K. Rumsey of Optimus Advisory Group

The Bureau of Labor Statistics (BLS) official unemployment report, also known to economic wonks as U-3, has historically been used to give a fairly accurate depiction of the overall employment situation in our country. Not anymore. This "depiction" of the jobs/employment environment is now meaningless.

2015-03-07 00:00:00 Trampled Under Foot: Earnings Estimates Crushed; But Not Stocks by Liz Ann Sonders of Charles Schwab

The pace of earnings estimate cuts by Wall Street analysts and companies has been well sharper than the norm, suggesting the bar has now been set so low as to make it easier to hurdle. That’s what investors can hope for heading into the next earnings season; but the risk around earnings and valuation is unquestionably higher than it’s been in some time.

2015-03-07 00:00:00 The Fat Pitch Weekly Market Summary by Urban Carmel of The Fat Pitch

Our overall view continues to be that 2015 will not be like 2013 or 2014. This is a year where fundamentals improve while equity prices mark time, allowing sentiment and valuation to fall back inline. This is a common pattern: large parts of 1994, 1996, 1998, 1999, 2004 and 2005 were similar. That November and December were the first back to back down months in 3 years bears out the change in character.

2015-03-07 00:00:00 After a Dismal 2014 Business Development Companies Poised to Outperform in the New Year by Grier Eliasek of Prospect Capital Corp.

After a dismal performance in 2014 business development companies are enjoying a reversal of fortune, floating to the top of the leaderboard in the New Year. They’re outpacing their interest-rate sensitive brethren, utilities and REITs, bonds and the S&P 500 alike amid widespread anticipation that the Federal Reserve will lift interest rates mid year. As the stock market grows ever more expensive and profit margins are reaching record highs, the catalysts that should drive outperformance in BDCs grow stronger and stronger considering that most BDCs are trading at single-digit multiples.

2015-03-06 00:00:00 Taking a Multi-Asset Approach to Inflation by Duy Nguyen of Invesco Blog

With more than two decades of stable inflation in the US and forecasts calling for moderate inflation in the short term, many investors have become complacent about the risk of inflation to the real value of their portfolios. But inflation can change unexpectedly, and although we don’t believe that change is necessarily imminent, investors should remain vigilant about addressing this risk.

2015-03-06 00:00:00 Hot and Cold Bonds by Anthony Valeri of LPL Financial

January 2015 was the best month for high-quality bonds since December 2008. In February 2015, high-quality bonds posted their worst monthly performance since June 2013 and the taper tantrum sell-off. High-yield bonds experienced ups and downs thus far in 2015. After a muted January, high-yield bonds returned 2.4% in February, the largest single month gain since October 2013. After a wild first two months, we expect more muted returns over the remainder of 2015.

2015-03-06 00:00:00 Market Fragility and Opportunity by Jim Tillar, Steve Wenstrup of Tillar-Wenstrup Advisors

Investing is a funny business. It is usually wise to invest the opposite of how the market feels to you. Six years ago stocks had fallen by 50%, the financial institutions that underlie our global economy were buckling, and the economy was in shambles. Investors were running from the stock market in droves. But because prices and expectations were low and because all the major central banks flooded the world with liquidity it was actually a great time to invest.

2015-03-06 00:00:00 Opportunities in Global Financial Disintermediation by Dave Gallagher of Calamos Investments

Increasing financial disintermediation is a strong secular theme providing tailwinds in several financial industries, but a likely arduous and complicated process warrants the need for a disciplined focus on both risk and reward. The financial system essentially performs one basic function—the direct or indirect movement of funds from savers to borrowers or investors. Although financial disintermediation is formally defined as the shifting of funds from indirect to direct financing, the term is more commonly used to describe the increasing role of non-bank intermediaries.

2015-03-06 00:00:00 The Great Monetary Expansion by Scott Minerd of Guggenheim Partners

While winter weather will likely distort first-quarter economic data, accommodative monetary policy around the world means the long-term outlook remains positive.

2015-03-06 00:00:00 Malaysia: Too Indebted to Spend? by Satya Patel of Matthews Asia

Many Asian households are dependent on debt. Malaysia has been working to reshape its economy while addressing the risk of high household debt levels. Asia Weekly examines this issue.

2015-03-06 00:00:00 China’s Reforms: Will They Work? by Hayden Briscoe of AllianceBernstein

The internationalization of China’s currency is proceeding hand in hand with the liberalization of the country’s capital markets. If China can surmount its short-term challenges, the impact of these reforms on global economies and markets should be profound.

2015-03-06 00:00:00 ECB Asset Purchases = (Big) Equity Decline? by Team of GaveKal Capital

We have commented quite a bit on the dismal revisions to sales and earnings estimates (see here, here, and here for just a few examples). As we have noted, European stocks have excelled in the downgrade department, led by the Energy sector.

2015-03-06 00:00:00 Growth Surprises and Possible Risks by Bill McQuaker (Article)

Bill McQuaker, Co-Head of Multi Asset, provides an update on the positive surprises that have unfolded recently in European data, the extent to which that has been reflected in prices and a few risks to keep an eye on mid-year.

2015-03-06 00:00:00 On the Investment Process of a Global Generalist by Jason Brady of Thornburg Investment Management

The process and logic behind the security selection and the construction of portfolios is, in many ways, as complex as the markets themselves. A portfolio of 50 holdings culled from only 500 possible choices leads to: 500!/(50!*(450!)) or 2.31442 x 1069 potential portfolios! That’s a lot of potential outcomes, and this doesn’t even take into account the various possible weights of those choices.

2015-03-05 00:00:00 Another Bubble? by Burt White of LPL Financial

The Nasdaq Composite just hit 5000 today as this report was going to press and is nearing its all-time record closing high of 5048. Even with the Nasdaq at 5000, we do not believe stocks have reached bubble territory. The Nasdaq has a much stronger foundation today of valuations, profits, and sentiment.

2015-03-05 00:00:00 Don’t Audit It: Reign It In by Brian Wesbury of First Trust Advisors

Some in Congress want to “Audit the Fed.” But an audit, unless the word is used in a very broad sense, would be redundant and basically irrelevant. The Fed is already audited, by Deloitte & Touche LLP and it releases an annual report that includes the auditor’s opinion, each year.

2015-03-05 00:00:00 Positioning U.S. Community Bank Investment Portfolios for 2015 by Chitrang Purani, Thomas Luciano of PIMCO

When market uncertainty is elevated and bank profitability is an ongoing concern, taking an extreme view toward investing cash or harvesting liquidity is not optimal. Currently, we do not see as much value in interest rate or duration risk for bank portfolios as yields imply a moderate path for future policy rates. We believe there are opportunities for banks to earn income without taking excess interest rate risk or limiting flexibility against the need to fund future opportunities.

2015-03-05 00:00:00 A Fair Hearing for Sovereign Debt by Joseph Stiglitz, et al. of Project Syndicate

Last July, when US federal judge Thomas Griesa ruled that Argentina had to repay in full the "vulture" funds that had bought its sovereign debt at rock-bottom prices, the decision reverberated far and wide, affecting bonds issued in a variety of jurisdictions. Do US court rulings really apply to contracts executed in other countries?

2015-03-05 00:00:00 The High Yield Default Outlook by Heather Rupp of AdvisorShares

We see default risk as the most prominent risk for credit investors. As we look forward, a benign default environment is projected over the next few years.

2015-03-05 00:00:00 The Dollar Is Breaking Out Again And What That Means For Stocks by Team of GaveKal Capital

The ICE US dollar index looks to have broken out of what has been a rather short-lived consolidation after the massive move since the middle of 2014. If this is in fact the start of another round of dollar strength, then stock investors should carefully consider where in the world to deploy cash into stocks. For a variety of cyclical and structural reasons, certain regions of the world tend to outperform in periods of USD strength and others lag. We'll try to shed some light on that with the below charts.

2015-03-05 00:00:00 Searching for Yield Down Under by Russ Koesterich of BlackRock

The persistence of low yields has had investors searching for income high and low for a while now. Recently, investors are expanding their hunt to some less than obvious places.

2015-03-05 00:00:00 India the Best-Performing Emerging Market by Frank Holmes of U.S. Global Investors

India had an incredible banner year. The world’s largest democracy, home to 1.25 billion people, was the best-performing emerging market in 2014, delivering over 29 percent. It was followed by the Philippines in second place and Indonesia in third.

2015-03-05 00:00:00 Greek Problems Born from Socialism by John Browne of Euro Pacific Capital

Like many of the important discussions in the economic world today, the negotiations between Greece and its European creditors has become increasingly absurd . Late on Friday, February 20, in a tense meeting between the new Greek Finance Minister and a host of ministers from 19 Eurozone countries, Germany apparently 'authorized' negotiators to accept a four-month extension of the $272 billion bailout so long as the Greeks promised to make a series of difficult fiscal steps needed to stay solvent over that time frame.

2015-03-04 00:00:00 Municipal Market Perspectives by Fixed Income Team of SMC Fixed Income Management

A much colder than normal winter throughout the United States has impacted daily activities. Folks are remaining indoors and waiting for the March thaw. Not only are there fewer pedestrians, but runners are a rare sight. The logical inference is that many dedicated exercisers have retreated to the warmth of their basements or local health clubs for exercise, and are instead logging miles on stationary treadmills.

2015-03-04 00:00:00 January Inflation Turns Negative - Is Deflation Upon Us? by Gary Halbert of Halbert Wealth Management

Consumer prices fell in January for the third straight month, while inflation over the past 12 months turned negative for the first time since 2009, largely because of cheaper gasoline. In January, the Consumer Price Index sank by a seasonally-adjusted 0.7%, the biggest one-month drop since the end of 2008, the Labor Department reported Thursday.

2015-03-04 00:00:00 A Plurisy Of Madness by Sebastiao Buck Tocalino of SBTCapital Clube de Investimento

When old grandpa Demographus entered the room and started speaking of the changing trends in business, with a growing number of workers retiring and his best clients spending less, attention was dispersed. Distraction and entertainment were provided by granny Janet.

2015-03-04 00:00:00 The Misery Index by John Canally of LPL Financial

Reports on the CPI and unemployment rate for January 2015 sent the Misery Index down to 5.6%, its lowest level in 56 years. Despite the low reading of the index, headlines and polls indicate the index may not be capturing the nation’s mood. Wage growth may be the key to improving consumer sentiment about the state of the U.S. economy.

2015-03-04 00:00:00 The Millennial Obsession by Jerry Wagner of Flexible Plan Investments

You cannot pick up a business publication, tune into a financial news program, or glance at any news website without confronting yet another story on Millennials.

2015-03-04 00:00:00 Tigers in Africa by Niels Jensen of Absolute Return Partners

This month's Absolute Return Letter is about unrealistic expectations which is something we are all guilty of from time to time. We look at why it is unrealistic to expect equity returns to be in the double digit range over the next several years, why central banks are not printing money like many believe, plus a few other topics.

2015-03-03 00:00:00 Howard Marks on Luck and Skill in Investing by Justin Kermond (Article)

When Howard Marks graduated from the Booth School of Business of the University of Chicago, he was turned down for the one job he really wanted. That, he said, was the luckiest moment of his career. The firm that turned him down was Lehman Brothers.

2015-03-03 00:00:00 Dan Fuss - The New Factor in the Bond Markets by Robert Huebscher (Article)

Dan Fuss' career in the bond market has spanned over 50 years. During that time, Fuss has spoken regularly at CFA luncheons. Last week in Boston, he began by warning that what he had to say would be markedly different from any of his previous talks.

2015-03-03 00:00:00 Why Networking Makes You Feel Dirty - New Research: The Mindset for Effective Networking by Dan Richards (Article)

Talk to advisors about networking and you will hear two main complaints: It's uncomfortable to introduce yourself to people you don't know, and it doesn't work. Many advisors have tried without success to convert community activity into new clients. Networking might make these advisors feel "dirty."

2015-03-03 00:00:00 Are DFA's Funds Active or Passive? by John Coumarianos (Article)

Larry Swedroe's recent critique of Graham and Dodd value investing mischaracterized DFA's value funds as "passive." Beyond that, he misread James Montier's discussion of "perfect" value investors, made unfair comparisons among funds and didn't measure risk properly.

2015-03-03 00:00:00 How to Tell If a Prospect Is Interested by Daniel Solin (Article)

Your presentation materials may be eminently persuasive and your delivery equally flawless, but your prospect's mind may be on an entirely different topic. Here's how to tell if your prospect is listening and - more importantly - interested in what you are saying.

2015-03-03 00:00:00 Can Aggressive Sales and Quality Service Co-Exist? by Beverly Flaxington (Article)

Providing the highest quality client service and finding time to network and uncover new sales is challenging at best and impossible at worst. Can these two goals coexist and be achieved?

2015-03-03 00:00:00 Reasonably Confident by Scott Brown of Raymond James

Fed Chair Janet Yellen signaled that officials will likely alter the forward guidance at the March 17-18 policy meeting. However, altering this guidance (the conditional commitment to keep short-term interest rates exceptionally low) is not the same as signaling that a rate hike is imminent, as Yellen made clear. She did indicate what would lead the Fed to start tightening.

2015-03-03 00:00:00 Is Japan Zimbabwe? by Axel Merk of Merk Investments

Is Japan Zimbabwe? How preposterous: Japan is an advanced economy that cannot possibly suffer the same fate as Zimbabwe. Right? Or could Japan get hyperinflation? Below I explain why Japan, and with it investors’ portfolios, might be at risk.

2015-03-03 00:00:00 The Return of the Comeback: Is 2015 the Year for International Stocks? by Zachary Karabell of Envestnet

For several years, many professional investors and advisers have been bullish about the prospects for investing outside the United States. Calls to overweight European stocks or global stocks have been typical each January for the past years, and this year is no different.

2015-03-03 00:00:00 The Euro: How Low Can It Go? by Jeremy Schwartz of WisdomTree

Recently, Professor Jeremy Siegel and I sat down with Brown Brothers Harriman currency strategist Marc Chandler. Given the European Central Bank’s (ECB) recent activities, most of the discussion centered around the euro.

2015-03-03 00:00:00 Yemen: A Land with a Rich Past and a Poor Present by Kaisa Stucke of Confluence Investment Management

The country of Yemen is slowly dissolving in the midst of an ongoing civil war. The Houthi movement has aggressively secured territories in the north, while al-Qaeda has widened its activities in the south. Outside powers are watching these developments closely. Yemen’s neighbor and U.S. ally, Saudi Arabia, would like to see the Houthi insurgency stopped as the group is widely viewed as a proxy for Iran. At the same time, the U.S. has been a partner to Yemen in fighting al-Qaeda in the Arabian Peninsula, but the fall of its government has left the U.S. without a formal partner.

2015-03-03 00:00:00 The Conference by Jeffrey Saut of Raymond James

Greetings from Orlando where the Raymond James 36th Annual Institutional Investors Conference is in full swing. At this year’s conference there will be more than 1,000 portfolio managers (PMs) and analysts, as well as more than 300 companies presenting. In a past life I used to attend many of Wall Street’s institutional investors conferences, but have come to like ours the best.

2015-03-03 00:00:00 Buffett on the Value of Patient Optimism by William Smead of Smead Capital Management

Like picking up the Good Book, a read of Berkshire Hathaway’s Annual Shareholder Letter yields insight, wisdom, and encouragement for the long-duration common stock investor in a world of short-term thinking and 30-second sound bites.

2015-03-03 00:00:00 The Benefits of Tiny Withdrawal Rates by Roger Nusbaum of AdvisorShares

For about the last year we have been blogging about the concept known as tiny houses. In that time interest has proliferated in terms of new websites devoted to the concept as well as at least four TV shows about tiny houses. The show Portlandia just had a bit making fun of tiny houses in a sketch where the toilet and the office were the same space as was the bathtub/shower and TV area.

2015-03-02 00:00:00 Going to the Dogs by Bill Gross of Janus Capital Group

If you were a dog, what kind would you be? I can’t say I’ve thought about it a lot myself, but it is an interesting, possibly introspective question considering the theory that many dog owners pick a breed that looks or perhaps acts like themselves.

2015-03-02 00:00:00 Value Oriented Bond Management by Jerry Paul, Zach Jonson of ICON Advisers, Inc.

Equity investors can be categorized into a broad range of equity strategies, including valuation-based approaches, whereas bond investors generally think in terms of interest rates and duration management. Professional investment managers have been taught that the market is efficient and while this may often be true, we believe there are a number of select areas within the bond market that exhibit less efficient behavior. This paper will discuss these potential inefficiencies and how “value oriented” bond management looks to exploit the inefficiencies. First we need to define “traditi

2015-03-02 00:00:00 Why We Invest in Royalty Companies by Frank Holmes of U.S. Global Investors

Royalty companies basically serve as specialized financiers that help fund cash-strapped miners’ exploration and production projects. In return, they receive either royalties on whatever the mine produces or what’s known as a “stream,” which is a commitment to an agreed-upon number of ounces of gold or other precious metal per year.

2015-03-02 00:00:00 The Most Important Number No One Is Talking About by Russ Koesterich of BlackRock

Economists are divided over the reasons behind the slowdown in U.S. productivity growth, but its effects on future economic growth are unquestionably negative.

2015-03-02 00:00:00 States Feel Impact of Oil Price Collapse by Joseph Rosenblum of AllianceBernstein

Crude oil prices have fallen sharply since last summer, a bright spot for American consumers. Major oil-producing states aren’t as happy, because the loss in tax revenue is impacting budgets and economies. Some states will face real hardship; others will emerge relatively unscathed.

2015-03-02 00:00:00 The Return of the Comeback: Is 2015 the Year for International Stocks? by (Article)

Will 2015 finally be the year for international stocks? Year-to-date performance suggests yes, as do proclamations by renowned market experts. But the case is far from clear or settled.

2015-03-02 00:00:00 US Economy: Cooler Than Consensus by Brian Horrigan of Loomis Sayles

The rebound is over, and we can’t just blame the dreadful winter weather. Much recent data have been disappointing. Even though I believe they are not bad enough to be recessionary signals, they do suggest that the recovery going forward may be a bit blander than hoped.

2015-03-02 00:00:00 On My Radar: Equity Valuations, Recessions and Market Declines by Steve Blumenthal of CMG Capital Management Group

Today let’s take a look at the hard evidence signaling slowdown. My personal view is that slowdown would not be as much of a problem if valuation measures were low. They’re not: by just about every measure the market is overpriced, overbought and over believed. What can you do? I share a simple and disciplined rules based way for you to stay invested in the market’s primary trend.

2015-03-02 00:00:00 What’s Really Driving the Value of the Euro and Yen? by Bradley Krom of WisdomTree

With a majority of developed markets rallying strongly over the last several years, we think the single biggest determinant for investors actually being able to capture those returns has hinged on their ability to manage currency risk.

2015-03-02 00:00:00 Markets Pause While Awaiting Federal Reserve Activity by Robert Doll of Nuveen Asset Management

U.S. equities were mixed last week, with the S&P 500 declining -0.2%. The Federal Reserve (Fed) had a busy week, as the nuanced debate continues around when to begin policy normalization. The global policy divergence grabbed headlines, but the focus was mainly on negative yields in Europe and inflows to non-U.S. equities.

2015-03-02 00:00:00 Today’s Floating Rate Loan Market by Heather Rupp of AdvisorShares

Together the high yield bond and floating rate bank loan market total over $3 trillion.1 This has evolved into a significant, and growing asset class. With high yield bonds and loans now representing about 30% of corporate credit2, this market deserves not only our attention, but we also feel is ripe with opportunity for investors.

2015-03-02 00:00:00 Fed Has Less Patience For ZIRP by Brian Wesbury, Robert Stein of First Trust Advisors

Economic data will have something for everyone this week. The ISM reports (manufacturing and non-manufacturing) will likely be held down by unusually harsh weather and the Port closures. But, autos sales should remain strong and January jobs data are set for a gain close to 250,000.

2015-03-02 00:00:00 Royce Premier Fund: Reviewing 2014 and Positioning for 2015 by (Article)

Portfolio Manager Lauren Romeo talks about the relative performance challenges for Royce Premier Fund and the types of businesses we are emphasizing and avoiding.

2015-03-02 00:00:00 Bill Hench on Consumer and Tech Stocks by (Article)

A bottom-up stock picker, Portfolio Manager Bill Hench is finding compelling valuations in the semiconductor industry. Bill also believes many Consumer Discretionary stocks are poised to benefit from the recent decline in energy prices.

2015-03-02 00:00:00 Why Puerto Rico may now be stuck in “no man’s land” by Municipal Insight Committee of Eaton Vance

Our Municipal Insight Committee examines the island’s significant short- and long-term liquidity challenges, and what they mean to muni bond investors.

2015-03-02 00:00:00 Tracking the Market with Social Media by Blair Jensen of Trade Followers

Over the past week we got several signals from the Twitter stream that a short term top is likely. At the very least we should see a choppy market rather than a strong rally higher.

2015-03-02 00:00:00 Nevis & NASDAQ 5000 by Doug MacKay, Bill Hoover of Broadleaf Partners

Fifteen years ago, the tech-stock heavy, dot-com laden NASDAQ hit 5000, a level it hasn't seen since - until today - March 2nd, 2015. Whether or not it will maintain a closing price above 5000 remains a work in progress, but in all likelihood, we'll get there.

2015-03-02 00:00:00 The Herd Can Be Blind by Peter Schiff of Euro Pacific Capital

Going into 2015 the economic outlook held by the U.S. investment establishment could not have been much more positive, and more unified. Pundits saw all the variables aligning to create the best of all investment worlds, a virtual "no-brainer" of optimism. Many believed that the 5.0% annualized growth in 3rd quarter would stay strong in the 4th Quarter and then usher in a strong 2015, which many believed would be the best economic year since the crash of 2008. The only question that divided most forecasters was how good the year would be.

2015-03-02 00:00:00 Obama Comments on IRA Fiduciary Rules by Andrew Friedman of The Washington Update

Last week the President gave a speech in which he focused on forthcoming Labor Department rules intended to ensure that IRA holders receive investment advice unencumbered by financial advisor conflicts of interest. In conjunction with the President’s speech, the Labor Department will be re-issuing proposed rules addressing the extent to which financial advisors may receive compensation in connection with investments made by IRAs and other retirement accounts they advise. The new proposed rules should be available in the next 60-90 days.

2015-03-02 00:00:00 A Greek Tragedy Averted - for Now by Milton Ezrati of Lord Abbett

While the Tsipras government has bought itself some time, the possibility of a Greek exit from the eurozone remains quite real—as does the risk to global financial markets.

2015-03-01 00:00:00 Weighing the Week Ahead: Will the Economic News Alter Fed Policy? by Jeff Miller of New Arc Investments

The exact timing of the first Fed rate increase does not matter. There is a difference between tight monetary policy and slightly less accommodative policy. Markets do quite well in the early stages of rising rates, especially when starting from a low initial point. This will be ignored by many who will invoke “Don’t fight the Fed.” This will be the fundamental battleground between traders and investors, bears and bulls, and various political types – perhaps lasting for years. The end of the business or stock market cycle is not imminent. Bull markets do not die of old age.

2015-03-01 00:00:00 Plan to Exit Stocks Within the Next 8 Years? Exit Now by John Hussman of Hussman Funds

Unless we observe a rather swift improvement in market internals and a further, material easing in credit spreads – neither which would relieve the present overvaluation of the market, but both which would defer our immediate concerns about downside risk – the present moment likely represents the best opportunity to reduce exposure to stock market risk that investors are likely to encounter in the coming 8 years.

2015-02-28 00:00:00 The Most Important Number No One Is Talking About by Russ Koesterich of BlackRock

Economists are divided over the reasons behind the slowdown in U.S. productivity growth, but its effects on future economic growth are unquestionably negative.

2015-02-28 00:00:00 The Negative Way to Growth? by Nouriel Roubini of Project Syndicate

Monetary policy has become increasingly unconventional in the last six years, with central banks implementing zero-interest-rate policies, quantitative easing, credit easing, forward guidance, and unlimited exchange-rate intervention. But now we have come to the most unconventional policy tool of them all: negative nominal interest rates.

2015-02-28 00:00:00 The Fat Pitch Weekly Market Summary by Urban Carmel of The Fat Pitch

When SPY has risen 3 weeks in a row, it most often rises further for at least one more week. SPY has been up 3 weeks in a row 19 times in the past 4 years. In 17 of those 19 times (89%), it continued up at least one more week. In one of those 19 instances, SPY gave back half its gains before going higher (yellow arrow); and in just one instance, SPY gave back 100% of its gains (red arrow).

2015-02-27 00:00:00 Are Expectations Too High? by Burt White of LPL Financial

The market’s continued ascent has caused some to ask if the stock market reflects excessive optimism. The pace of economic surprises as measured by the Citigroup Economic Surprise Index suggests expectations remain reasonable. We view recent economic disappointments as largely temporary, and would expect the surprise index may reverse recent declines as expectations have come down, providing support for cyclical sectors.

2015-02-27 00:00:00 Lost in Translation: Navigating the Changing Environment for Investment Information by David Robertson of Arete Asset Management

In the best of times, it requires effort and expertise to filter through investment information. Since the financial crisis, however, that challenge has gotten even harder.

2015-02-27 00:00:00 Recession is On the Way: Questioning One's Sanity; Beat the Crowd, Panic Now! by Mike "Mish" Shedlock of Sitka Pacific Capital

In 2006-2007 I called for a recession. We got a big one. I called for another one in 2011, as did the ECRI. That recession never happened. 50% is not a very good recession predicting track record except in comparison to consensus economic opinions that have never once in history predicted a recession. Consensus opinion is batting a perfect 0.00%

2015-02-27 00:00:00 Macro View Rate Hike Rally by Scott Minerd of Guggenheim Partners

The lead-up to the first rate hike by the Federal Reserve is historically a favorable environment for U.S. equities and credit.

2015-02-27 00:00:00 Could Apple Buy a Third of the World’s Gold? by Frank Holmes of U.S. Global Investors

So what’s Apple’s next trick? How about moving the world’s gold market?

2015-02-27 00:00:00 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

The U.S. Housing Industry Continues to Struggle; The "Millennials" Hold the Key to Housing; Is Another Bubble Forming in U.S. Commercial Real Estate?

2015-02-27 00:00:00 Focusing on the Three Ds by Byron Wien of Blackstone

Looking forward several years, there will be three important factors that will determine the economic and investment outlook. They are decoupling, deflation and demand.

2015-02-27 00:00:00 With the Bank of Canada, Is the Canadian Economy in Good Hands? by Ed Devlin of PIMCO

A disorderly decline in energy prices could spill over into consumer and business sentiment, which would worsen any drop in Canada's economic output. More rate cuts this year are likely a part of the Bank of Canada's base case scenario. Investors may be able to improve their returns by buying bonds with high-quality credit spreads, including Canadian bank senior debt and Ontario bonds.

2015-02-27 00:00:00 We're Having "Flation" by Rob Isbitts of Sungarden Investment Research

We decided to look back at the last four years and get a sense of what is happening with prices. And, like so many investment discussions these days, our conclusions are not uniform. In the case of consumer prices, we are having inflation, disinflation depending on which major component of the CPI you watch. Conclusion: just as the broad stock market can have many underlying sub-trends within it, so too can that be the case for consumer prices. “Flation” – it is everywhere and of all three types in today’s consumer world.

2015-02-27 00:00:00 On the Long Bond and Why the Widow Maker is Alive and Well by Team of GaveKal

Perhaps one of the most important questions investors need to answer today is whether we've seen the low in the long bonds yields or whether the trend lower is firmly intact. The recent spike in the 10-year bond yields from 1.65% at the end of January to 2.14% just two weeks later has no doubt complicated the situation. In this piece we'll try to layout one case for lower yields still.

2015-02-27 00:00:00 China’s New Generation of Entrepreneurs II by Beini Zhou of Matthews Asia

China has long been perceived to be a breeding ground for business copycats, and has struggled with rampant intellectual piracy. Many businesses there have indeed been founded based on business models that originated in the U.S. or Europe. But what’s been overlooked in recent years is China’s rising “innovation machine.” More favorable government policies toward R&D have helped. This month, Asia Insight takes a look at developments in China’s grassroots-level entrepreneurship.

2015-02-27 00:00:00 Hasenstab on Global Growth: Headwinds or Tailwinds? by Michael Hasenstab of Franklin Templeton

While some forecasters predict gloomy global growth this year, the contrarian-minded Dr. Michael Hasenstab, chief investment officer, Templeton Global Macro Group (formerly known as Templeton Global Bond Group), has a different view. He aims to counter what he sees as “excessive pessimism” surrounding the global economy and outlines why he believes the recent plunge in oil prices could prove a tailwind, not only for economic growth in the United States, but also in Europe. He also offers his scorecard regarding Japan’s monetary policy experiment dubbed “Abenomics.”

2015-02-27 00:00:00 ECRI Recession Watch: Weekly Update by Doug Short of Advisor Perspectives (dshort.com)

Today's new release of the publicly available data from the Economic Cycle Research Institute (ECRI) puts its Weekly Leading Index (WLI) at 130.6, up slightly from 130.4 the previous week. The WLI annualized growth indicator (WLIg) is at -4.5, down from the previous week's -4.2 but off the interim low of -5.0 in mid-January.

2015-02-27 00:00:00 Rhyming…but not Repeating. by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

Stocks have recovered their January losses and have continued to move higher. While economic growth remains solid and we remain secular bulls, investors should be prepared for increased volatility and the potential for a near-term correction. Also, European stocks may be due for at least a pause and we suggest looking to add exposure to emerging market positions if needed. Staying well diversified and keeping an eye on rebalancing is the recommended strategy.

2015-02-27 00:00:00 Power Surge for Women as Emerging Consumers by Tassos Stassopoulos of AllianceBernstein

What’s the connection between electricity and women? Electricity is an agent of empowerment, able to transform societies and economies in emerging markets. It paves the way to buying home appliances like electric cookers, refrigerators and washing machines, freeing up women from hours of daily housework. In our view, more access to power in developing countries will be a catalyst for more women to join the workforce, leading to huge changes in consumer spending patterns.

2015-02-27 00:00:00 Reconnecting with Energy Stocks by Sharon Fay of AllianceBernstein

Plunging oil prices since mid-2014 have led many equity investors to shun energy stocks. We think that’s a mistake. By studying the aftermath of previous oil shocks, we believe investors can gain insight to prepare for a possible rebound.

2015-02-26 00:00:00 Obama Steps Up by Simon Johnson of Project Syndicate

For the past six years, Barack Obama's administration has, more often than not, sided with the interests of big banks on financial-sector policy. But this week, announcing a new proposal to prevent conflicts of interest in financial advising, Obama seemed to turn an important corner.

2015-02-26 00:00:00 Equity Valuations, Recessions and Stock Market Declines by Doug Short of Advisor Perspectives (dshort.com)

When I initiated the dshort web page in late 2005, one of my routine topics was equity valuations, initially inspired by Nobel laureate Robert Shiller's book, Irrational Exuberance, the second edition of which was published earlier that year. I gradually expanded my focus from his cyclically adjusted price-to-earnings ratio (CAPE) to include Ed Easterling's Crestmont P/E, Nobel laureate James Tobin's Q Ratio and my own monthly regression analysis of the S&P 500.

2015-02-26 00:00:00 Family-Owned Businesses: One More Reason Not to Neglect Emerging Markets by David Ruff of Forward Investing

At the end of a year in which the U.S. handily led the world’s equity markets, many dividend investors find it hard to rouse any interest in emerging markets at all. “Why even bother?” seems to be the prevailing sentiment.

2015-02-26 00:00:00 Yellen’s Trip to the Hill, a Preview… by Scott Brown of Raymond James

Fed Chair Janet Yellen will testify on monetary policy on Tuesday and Wednesday. These appearances are less traumatic for the financial markets than they used to be. The Fed releases minutes of the policy meetings on a timelier basis and the Fed chair holds press conferences after every other meeting. Hence, it’s unlikely that we’ll see Yellen signal a major change in the policy outlook. Still, the financial markets will pay attention.

2015-02-26 00:00:00 Gathering Thin Reeds? by Jeffrey Saut of Raymond James

Many of you know that I spend time gathering “thin reeds” and try to weave them into a favorable “investment bouquet.” This is a strategy Fidelity’s Peter Lynch took to its zenith in an era gone by. Recall the story Peter told about how he stumbled into Magellan Fund’s (FMAGX/$96.12) investment in Hanes, when he first heard his wife rave about a new product called pantyhose.

2015-02-26 00:00:00 Investing in Volatility: Is Asian Volatility Poised to Rise? by David Jubb of Invesco Blog

Volatility is cheap these days. That may sound strange at first. But, the Invesco Multi Asset team views volatility as an investable asset type that can be included in our investment strategy. Why might this make sense? We believe volatility can provide additional diversification and return benefits when combined with our portfolio’s other asset exposures. For example, when volatility is low, markets may benefit. But when it rises, markets can come under pressure.

2015-02-26 00:00:00 Rise in Spanish CDS Outpaces Greece by Team of GaveKal Capital

Unsurprisingly, the cost of insurance against Greek default (as evidenced by 10-year credit default swaps) has risen since the beginning of the year. It is interesting to note, however, that the monthly rate at which Spanish CDS are rising is actually higher, increasing more than 20% according to the most recent data point.

2015-02-26 00:00:00 Monetary Policy Matters by Mark Mobius of Franklin Templeton Investments

This year we expect the divergence in monetary policy among the world’s central banks to be a key theme and a likely driver of asset flows. For now, the scorecard seems to be tilted toward monetary easing since in the first month of 2015 alone, 14 central banks engaged in some form of monetary policy loosening, generally in the form of interest rate cuts or asset purchases.

2015-02-26 00:00:00 Why Does Louis Vuitton Like a Weaker Euro? by Christopher Gannatti of WisdomTree

In an article published January 31, 2013, Bernard Arnault, the chief executive of LVMH, was quoted as saying, “The cloud on the horizon … is the evolution of currencies, [and a strong euro] would have an impact on French exporters and for our group …”

2015-02-26 00:00:00 Viewer Discretion Advised by Dan Walker of Heartland Advisors

Rich valuations for Utility stocks and current low bond yields point to a dim future for the sector.

2015-02-26 00:00:00 Hedge Funds on the Comeback? by Roger Nusbaum of AdvisorShares

A few days ago I stumbled across a post from CIO titled Reports Of My Death Have Been Greatly Exaggerated that chronicles the outflows from hedge funds last year and posits whether a comeback might be around the corner but with generally lower fees. The lower fee angle of the article seemed to focus on negotiating a lower fee with the manager. Of course lower fees are available through the various exchange traded products that one way or another replicate the exposure but doing so without the so called ‘2 and 20’ fee structure.

2015-02-26 00:00:00 Rate Hike Rally by Scott Minerd of Guggenheim Partners

The lead-up to the first rate hike by the Federal Reserve is historically a favorable environment for U.S. equities and credit.

2015-02-25 00:00:00 At a Standstill? - The Debate Over "Secular Stagnation" by Team of Northern Trust

During one particularly stormy day recently, I asked my daughter to unearth herself from the couch and help me clear the snow from the driveway. Unfortunately, the prospective reward of industry was no competition for the television remote, and I was left to fend for myself.

2015-02-25 00:00:00 Putting Declining Sales Estimates In Context by Team of GaveKal Capital

We track analyst estimates in a variety of ways. We look at growth rate expectations over the next four years. We also measure the percent change in the level of USD estimates across various time frames. We also track the difference in growth rates now versus three months ago. Finally, we look at the percent of companies that are experiencing a positive earnings revision over various time frames.

2015-02-25 00:00:00 Complexity, Critical States and Tributaries of Uncertainty by Brooks Ritchey of Franklin Templeton Investments

For long periods of time, the markets can advance relatively smoothly until a sudden onset of chaos occurs, a “tipping point” that quickly changes the picture. Some might say the recent drop in oil would be a case in point. Brooks Ritchey, senior managing director at K2 Advisors, Franklin Templeton Solutions, explores the tipping points that trigger dramatic market turns, and ponders whether he thinks global equities may be teetering on the edge of one today.

2015-02-25 00:00:00 China Levels the Global Playing Field by Hayden Briscoe of AllianceBernstein

It’s a powerful vision for the world’s future. The US and China: two growth powerhouses; two major currencies.

2015-02-25 00:00:00 Greece Clears First Hurdle: More to Come by Russ Koesterich of BlackRock

Early negotiations between Greece and its creditors brought about an extension to the bailout program, but talks could remain contentious. What should investors focus on during this time?

2015-02-25 00:00:00 Lower Lows Still to Come for Silver & Gold by Avi Gilburt of ElliottWaveTrader.net

Yes, I want to be abundantly clear, as some still question my perspective, even though I have reiterated this time and again: I believe metals will see lower lows before this 3+ year correction will end. And, simply because I noted that I was keeping an open mind in January as to the market proving me wrong by completing an impulsive move off the November lows did not change my primary perspective. So, I believe I have been rather consistent and clear that my expectation was and has been that lower lows have yet to be seen to complete this 3+ year correction.

2015-02-25 00:00:00 The Strange World of Negative Interest Rates by Lowell Yura of BMO Global Asset Management

This article examines explanations for negative bond yields. The article argues that central bank policies may be one of the causes. The article also suggests that to make sense of low Treasury yields, investors should be mindful of global yield correlations.

2015-02-24 00:00:00 Gundlach to the Fed: "Dont Raise Rates" by Robert Huebscher (Article)

The Fed should reject its inclination to raise rates, according to Jeffrey Gundlach. It's rare that he agrees with Larry Summers, but in this case the two believe that the fundamentals in the U.S. economy do not justify higher interest rates.

2015-02-24 00:00:00 An In-Depth Look at the Sequoia Fund by Larry Swedroe (Article)

Looking at its 35-year track record, some now consider the Sequoia Fund (SEQUX) an anomaly; it is an actively managed fund that has persistently generated positive risk-adjusted returns, outperforming its peers and its benchmark. Should investors expect this outperformance to persist?

2015-02-24 00:00:00 The Big Threat to Your Reputation by Dan Richards (Article)

Yelp and other "advisor-ratings" sites give a new platform to former clients who bear grudges. Fortunately, you don't have to be a powerless victim. There are some simple, proactive measures that can help you protect your reputation against unfair reviews.

2015-02-24 00:00:00 The Power of Mimicry by Daniel Solin (Article)

You are in a meeting with a prospect. You want to do everything you can to convert that prospect into a client. What actions can you take to maximize the possibility of success?

2015-02-24 00:00:00 A Lesson from Little League by Martin Weil (Article)

I tip my hat to Little League for the courage of their convictions in how they dealt with the transgressions by Chicago's Jackie Robinson West team. I only wish that the same justice might have been meted out to those firms who gamed the system throughout the 1990s and 2000s.

2015-02-24 00:00:00 A Fresh Look at Life Settlements in 2015 by Stephen Terrell (Article)

Rather than let unneeded term policies expire, clients may be able to sell them to a life insurance settlement provider. Life settlements were historically limited to whole-life policies, but new developments offer advisors greater flexibility to access cash for a variety of insurance products.

2015-02-24 00:00:00 How to Tell Your "Story" Effectively by Beverly Flaxington (Article)

We have been very successful when we sit down with a prospect to tell our story. However, our newest advisors find this more challenging. Our story is clear to them, but it isn't distinct from what they have heard at other firms. How can we reinforce our story or build a new one incorporating ideas from our staff?

2015-02-24 00:00:00 On My Radar: A $9 Trillion Dollar Crisis by Steve Blumenthal of CMG Capital Management Group

Here is the main point of today’s OMR: According to the Bank of International Settlements, non-bank borrowers outside the U.S. have borrowed, in dollars, $9 trillion. This is an increase of $4.5 trillion since the financial crisis and it places that $9 trillion on the wrong side of the dollar bet. The dollar debt is an example of how the Fed’s tightening will impact the world economy. This is a pressure cooker and the pot is starting to boil.

2015-02-24 00:00:00 While the World Is Not Flat, Distributions May Be by William De Leon, Courtney Walker of PIMCO

?Investors have long relied on the assumption that asset returns are normally distributed with correlations that are slow to change. Based on our analysis, however, we now have flat distributions and correlations that are much less stable; a fat-tailed event to either the left or the right is as likely to occur as a non-event. Active management that recognizes and adapts to these changes will be essential to seeking strong returns in the future.

2015-02-24 00:00:00 2015 Leadership: An Early Take by Doug Ramsey of Leuthold Weeden Capital Management

Last year’s economically defensive winners held their grip on stock market leadership in January. This action is consistent with our view that the bull market is an aged, overvalued one that has begun a final “distribution” process that will eventually erupt into a cyclical bear. Like every other facet of the topping process, though, defensive leadership can persist for an extended period—to the point that it’s ignored when there’s a genuine warning to be heard.

2015-02-24 00:00:00 Municipal bonds in 2015: Time to get back to basics by Municipal Insight Committee of Eaton Vance

In this insight, our Municipal Insight Committee examines why munis remain compelling in 2015 after a year of robust performance.

2015-02-24 00:00:00 U.S. Economy: Will Growth Be Roaring, or Boring? by Milton Ezrati of Lord Abbett

Here’s a look at key indicators—and what they signal for the pace of U.S. economic activity.

2015-02-24 00:00:00 Finally, At Least One Financial Media Person Gets It by Jerry Wagner of Flexible Plan Investments

I spent the last two weeks on a Caribbean island (as I always say: Timing is everything!). We rented a house and had lots of visitors from “Up North” (my wife will be there a month and during that time we will have had seventeen people staying in the house!).

2015-02-24 00:00:00 Coffee Camaraderie and Lingering Questions by Michael Kayes of Willingdon Wealth Management

America has the opportunity to lead the world economy far into the future. Read on to find out the key drivers and challenges to global leadership.

2015-02-24 00:00:00 Markets Vs Economy - The Great Disconnect by Lance Roberts of Streettalk Live

Last week, the markets hit new "all-time" highs as Greece caved into the demands of the Eurozone, at least for now, in order to secure funding for another four months. The relief that the latest Eurozone crisis has been resolved sent money flowing into equity markets as investors remain "afraid to miss out" on rising asset prices. The general consensus of analysts and economists is that the rise in capital markets is clearly a sign of economic strength which makes equities the "only game in town" as long as Central Banks stand at the fore.

2015-02-24 00:00:00 Debt Be Not Proud by John Mauldin of Mauldin Economics

Some things never change. Here is Eugen von Böhm-Bawerk, one of the founding intellectuals of the Austrian school of economics, writing in January 1914, lambasting politicians for their complicity in the corruption of monetary policy.

2015-02-24 00:00:00 Détente with Iran: An Update by Bill O'Grady of Confluence Investment Management

This report is an update to a similarly titled piece we published in 2013. In this report, we delve further into what appears to be an evolving policy change by the U.S. with Iran, discussing the basic goals of the U.S. and Iran. With this background, we examine America’s alternatives to achieving our aims in the region, followed by a full examination of U.S. difficulties in making a historic policy change with Iran. We discuss the recent policy pattern in the region and how it supports the notion that improving relations with Iran is probably the reason for this pattern.

2015-02-24 00:00:00 Is Gold Risk Free? by Axel Merk of Merk Investments

I’ve long argued that there may not be any safe asset anymore and that investors may want to take a diversified approach to something as mundane as cash. But what about gold? When I mentioned in a recent interview that not even gold is ‘risk free,’ it raised some eyebrows in the gold community. Let me elaborate.

2015-02-24 00:00:00 Find Hated, You May Find Wealth by William Smead of Smead Capital Management

As we overhear the chatter of major stock market media outlets and read the best writing on publicly-traded companies, we realize how incredibly popular and exciting most of the companies are which dominate investment news. We like to think of it as a love affair between investors and certain “popular” companies. There are numerous contrarians floating around in the media world as well and they caught our attention recently.

2015-02-24 00:00:00 Steady on the Renminbi by Stephen Roach of Project Syndicate

As China's exports sag and the risk of deflation grows, many believe that a reversal in currency policy is the most logical course. But intervening to weaken the exchange rate would be a serious mistake.

2015-02-23 00:00:00 Yes, There Will Be Growth in the Spring by Paul Kasriel of Econtrarian

Looking past the large upward revision to November 2014 nonfarm payrolls, you might have noticed that the U.S. economy has entered, in the words of the Federal Reserve’s version of Chance, the Gardener, Alan Greenspan, a “soft patch”. In recent months, labor conditions have weakened, manufacturing activity has hit a wall, consumer spending has waned and residential real estate demand has sunk.

2015-02-23 00:00:00 Exploring for High Yield Energy Opportunities Amid Ailing Oil Prices by Scott Roberts of Invesco Blog

Energy is a popular topic of conversation in the high yield bond space, with many observers warning of a wave of defaults to come due to the plunge in oil prices. While there will likely be some defaults in the sector, we believe that the market’s pessimism has been overly broad, and we view energy as a potential source of opportunity in 2015. Having a clear understanding of macro drivers in energy, paired with careful security selection, will be key to successfully navigating this volatile space, in our view.

2015-02-23 00:00:00 When Volatility Rises, So Have Active Management Results by Team of The Royce Funds

For many investors, volatility is often synonymous with risk. We as value investors (and risk managers), on the other hand, have always viewed volatility as a crucial component of active stock selection. In our latest Royce Research piece, we explore the relationship between low- and high-volatility environments and the relative performance of active managers versus their respective benchmarks during these periods. This deep dive is especially important in a market that has recently seen more volatility and its largest correction in almost three years.

2015-02-23 00:00:00 Weekly Market Summary by Urban Carmel of The Fat Pitch

SPX has risen two weeks in a row for the first time in 2 1/2 months. For the week, SPX gained 2%, DJIA 1% and RUT 1.5%. The big winner was the previously worrisome laggard, NDX, which gained 3.7%.

2015-02-23 00:00:00 Weighing the Week Ahead: Help for the Economy from Housing? by Jeff Miller of New Arc Investments

The economic calendar includes much more housing data than we normally see in a single week. With Fed Chair Yellen’s Congressional testimony and the GDP revisions also on tap, I expect many observers to be linking these topics. They will ask:

2015-02-23 00:00:00 US Existing Home Sales Drop To 9-Month Low by Team of GaveKal Capital

US existing home sales fell by 4.9% in January to 4.82 million. This is the lowest level since April of last year.

2015-02-23 00:00:00 Global Reflation Should Allow Equities to Push Higher by Robert Doll of Nuveen Asset Management

Financial markets reacted well to the provisional Greek bailout extension, but risks for Europe remain elevated. Wages appear to be starting to climb, which would increase pressure on the Fed to begin rate increases this summer. There is a valid bearish case to be made, but we think the positives for equities outweigh the negatives.

2015-02-23 00:00:00 Why the Bond Market Is Yielding Negative and What Negative Yields Mean for You by Vineer Bhansali, Ben Emons of PIMCO

Negative yields on bonds are no longer unicorns. In Switzerland, Germany, Denmark and several other European countries, government bonds are trading at negative nominal yields. There are four potential reasons that can explain the negative yield conundrum and can also illustrate the trade-offs between different investment strategies.

2015-02-23 00:00:00 Strong Dollar: Good, Not Bad by Brian Wesbury, Robert Stein of First Trust Advisors

In fifteen short days, the bull market will be six years old. And, we’ve never seen such a steep wall of worry. Nouriel Roubini called it a “dead cat bounce.” Many said the recession wouldn’t end until 2010, maybe 2011. Supply-siders said the “Fiscal Cliff” would do us in. Keynesians said “The Spending Sequester” would end the boom.

2015-02-22 00:00:00 Weekly Economic Commentary by Team of Northern Trust

The dramatic retreat in the price of oil and other commodities has muddied the waters for those trying to assess inflation. The world’s central banks, most of which are charged with meeting an inflation target, are among those struggling to gain adequate visibility.

2015-02-22 00:00:00 Deja You? by Robert Isbitts of Sungarden Investment Research

This picture is the story of many investors’ lives, providing they were investing 20-25 years ago. While younger investors may not be able to “feel” the similarities between today’s investor environment and that of the late 1990s buildup to the Nasdaq Composite hitting the 5000 level, those of us who remember it...

2015-02-22 00:00:00 Mind-Blowing: China Consumes More Gold Than the World Produces by Frank Holmes of U.S. Global Investors

The Chinese New Year, which kicks off today, is the largest and most widespread cultural event in mainland China, bringing with it massive consumer spending and gift-giving. During this week alone, an estimated 3.6 billion people in the China region travel by road, rail and air in the largest annual human migration.

2015-02-22 00:00:00 Apple’s Halo Masks US Earnings Conundrum by James Tierney, Jr. of AllianceBernstein

Deep into the US earnings season, the halo from Apple’s shining performance has lit up an otherwise lackluster market. This is no consolation for the rest of the companies in the S&P 500. In this type of market, we believe investors need to be especially discriminating.

2015-02-22 00:00:00 Will Interest Rates Defy Expectations Again? by Russ Koesterich of BlackRock

U.S. interest rates so far this year have not risen above their low levels. While long-term yields are unlikely to spike, we expect U.S. rates (both short- and long-term) to climb over the next 12 months.

2015-02-21 00:00:00 International Equity Commentary: January 2015 by Team of Thomas White International

International equity prices were mostly unchanged during January as gains in both developed and emerging Asian markets were offset by weakness in Canada and select markets in Europe. Investors turned more cautious after the International Monetary Fund and the World Bank lowered their global growth forecasts for the current year, contrary to expectations.

2015-02-21 00:00:00 Global Economic Overview: January 2015 by Team of Thomas White International

Concerns about the sharp fall in capital investments and earnings growth in select sectors resulting from lower oil prices continue to cloud the global economic outlook. While the decline in fuel prices is revitalizing consumer spending across all the major countries, the energy and mining sectors have already started curtailing their capital outlays.

2015-02-21 00:00:00 Emerging Markets Equity Commentary: January 2015 by Team of Thomas White International

Emerging market equity prices outperformed in January on expectations that economic conditions in large Asian countries such as China and India could brighten this year. Fourth quarter GDP growth in China met expectations, helped by higher industrial production and consumer spending.

2015-02-20 00:00:00 Developed Asia Pacific: Economy Trends Update January 2015 by Team of Thomas White International

Japan, the biggest of the developed economies in the region, stands to benefit from cheaper oil as it should boost domestic demand and help some of the country’s key industries reduce costs. Still, the bigger advantage for the country seems to be the re-election of Prime Minister Abe, which has ensured continuity of the fiscal and monetary policies pursued by the government for the last two years.

2015-02-20 00:00:00 Middle East/Africa: Economy Trends Update January 2015 by Team of Thomas White International

This year likely promises mixed prospects for the Middle East and Africa. Among the five economies under our coverage in this region, oil exporters U.A.E. and Qatar are expected to remain under pressure amid the oil price slump. On the other hand, oil-importing South Africa will probably benefit from the downtrend in oil prices as a potential rise in domestic consumption should help the beleaguered economy deal with its various problems.

2015-02-20 00:00:00 High Yield in a Rising Rate Environment: Duration and Yield by Heather Rupp of AdvisorShares

We began February with a yield on the 10-year Treasury of 1.68% and today sit at 2.14%.1All the concerns and talk of maybe even no rate rise this year that we saw in January, have turned to frequent mention of a rate rise beginning in June. So what are bond investors to do? Is this finally the year of rising rates and what impact does that have?

2015-02-20 00:00:00 A Stable Outlook for US Banks: 6 Factors to Watch by Elizabeth Schroeder of Loomis Sayles

Overall, my outlook for US banks remains stable with some hope for a positive turn later in 2015. The game changer will be the Federal Reserve. Should the Fed begin to take steps towards higher rates this year, bank earnings could improve.

2015-02-20 00:00:00 Forward Estimates, Valuations vs. Returns, Told You So by Lance Roberts of Streettalk Live

I got into a debate recently with a gentleman who was adamant that current valuation levels in the market did not suggest trouble ahead. The problem is that his valuation argument was based on the use of forward operating earnings estimates. Let me explain why this is a faulty assumption.

2015-02-20 00:00:00 The Case for Global Investing by Team of Litman Gregory

As U.S. stocks have outperformed developed international and emerging-markets stocks in recent years, we’re starting to hear more people question the benefit of investing outside of the United States. This is an important question, and we acknowledge that owning foreign stocks has been an unsatisfying experience over the past couple of years. Moreover, given some of the current economic and geopolitical forces, it can appear likely to continue this way.

2015-02-20 00:00:00 Skeptical, Yes. Cynical, No. by Edward Talisse of Chelsea Global Advisors

A cynic is someone who is negative ahead of the evidence and will who only, if ever, grudgingly admit to reality. Financial markets have always been afflicted by cynical perma-bears and detractors who simply refuse to acknowledge the power of the market’s relentless upward drift in equity prices over the past two centuries. The data is unassailable.

2015-02-20 00:00:00 Global GDP Tracker by John Canally of LPL Financial

The top 25 global economies make up 90% of global gross domestic product (GDP). Through Friday, February 13, 2015, 13 of these economies (including countries and political unions) have already reported Q4 2014 GDP results, including the four largest economies (U.S., Eurozone, China, and India). As this commentary was being prepared for publication, Japan, the world’s fifth-largest economy, released Q4 GDP results.

2015-02-20 00:00:00 Mardi Gras Market by Brian Andrew of Cleary Gull

Geo-political concerns in the Middle East and Ukraine don’t seem to be able to keep the market down, nor do the tepid economic growth numbers coming from Europe and China. Finally, corporate earnings expectations have been moderated significantly for 2015 and that doesn’t seem to matter to stock prices either. Perhaps the explanation is in the sentiment.

2015-02-20 00:00:00 The Glass Ceiling on Rates by Scott Minerd of Guggenheim Partners

With the debt-to-GDP ratio at historic highs, the Fed doesn’t have much room to maneuver on the federal funds rate.

2015-02-19 00:00:00 Loan Fund Primer by Roger Nusbaum of AdvisorShares

Last week the Riksbank (the Swedish central bank) dropped its benchmark interest rate to -0.10 and as of earlier this week Sweden’s ten year sovereign debt was yielding 0.50%. So Sweden is now the latest country to make headlines about extreme central bank policy to stimulate growth.

2015-02-19 00:00:00 Mistakes Must Service a Purpose by Francois Sicart of Tocqueville Asset Management

In his latest piece, Francois Sicart, Founder and Chairman of Tocqueville Asset Management, examines some investment mistakes he's made in the past. He details five investments, explaining the rationale behind the purchase, what went wrong, and what he learned.

2015-02-19 00:00:00 Hub Group: A Long-Term Investment Thesis by Jason Downey of Diamond Hill Capital Management, Inc.

In September 2013, we outlined our favorable view of the domestic intermodal transportation industry driven by cost advantages, continued market share growth opportunities, and improving pricing power. At that time, we viewed Hub Group, Inc. (HUB) and Pacer International, Inc. as the most attractive investment opportunities within the industry. During the last seventeen months there have been material developments in each of these areas, some positive and some negative.

2015-02-19 00:00:00 Energy Sector Outlook: What We Are Watching by Burt White of LPL Financial

No sector is getting more attention right now than energy. Market participants are attracted to the potential upside after both oil and the energy sector suffered substantial declines in recent months. Many see the sector as cheap, something that is not easy to find these days in the U.S. equity market. We drive by gas stations every day where we see prices have been cut in half, serving as a constant reminder of how cheap oil is. In this commentary, we discuss what we are watching to assess the opportunity in energy.

2015-02-19 00:00:00 2015 Annual Forecast by Clyde Kendzierski of Financial Solutions Group

It’s already February, but for many readers this is the first communication of 2015 so, Happy New Year! It’s been a great 6 weeks so far and we’re looking forward to many more to come. Let’s get into it…

2015-02-19 00:00:00 ??Why Does the Internet of Things Matter? by Vladimir Cara, Iain McNaught, Ji Young Park of PIMCO

The opportunity to gather, process and use data more effectively is potentially worth several trillion dollars across multiple industries over the next decade. We expect most industries to adopt some form of this technology, with network effects and competitive dynamics leading to almost ubiquitous adoption beyond the current decade.

2015-02-19 00:00:00 Great Expectations for Small-Cap Active Management by Chuck Royce, Chris Clark, and Francis Gannon of The Royce Funds

Widening credit spreads, increasing volatility, and decreasing stock correlation should allow stock pickers the chance to emerge as performance leaders. We continue to see good times ahead for active managers who focus on business fundamentals.

2015-02-19 00:00:00 February 2015 Economic Update by John Richards of Bronfman E.L. Rothschild

Consumers in the U.S. are showing their optimism by pushing a key consumer sentiment indicator to its highest level in over a decade. Despite a drop-off in Q4 GDP to a 2.6% annualized growth rate and three consecutive months of slowing manufacturing expansion, the U.S. economy still seems to be on strong footing.

2015-02-19 00:00:00 Liquid Endowment Portfolios by (Article)

In this video for The PMC Spotlight, Michael Featherman, Director of Portfolio Strategies, discusses how the "endowment" portfolio framework addresses the headwinds recently faced by conventional sources of diversification.

2015-02-19 00:00:00 Brighter Days Ahead for the Global Economy? by Team of Thomas White International

After seven years of uneven growth trends following the 2008 financial crisis, we believe the global economy is likely to see a moderate acceleration in 2015. While several risks remain, we are reasonably confident that there are now enough growth drivers in place to help most major economies advance.

2015-02-19 00:00:00 Global Economic Overview: December 2014 by Team of Thomas White International

After the initial optimism about lower energy prices supporting a healthier global economic growth outlook, investors and analysts have become more apprehensive as the price decline has been remarkably steep.

2015-02-19 00:00:00 International Equity Commentary: December 2014 by Team of Thomas White International

International equity prices corrected during the month as fears about the negative economic and political fallout of the steep drop in oil prices on energy producing countries unnerved investors. Brent crude oil prices fell to a six-year low during the month, a decline of more than 50 percent in four months.

2015-02-19 00:00:00 Emerging Markets Equity Commentary: December 2014 by Team of Thomas White International

Emerging market equity prices corrected during the month on concerns that the steep fall in crude oil prices could hurt the outlook for select countries.

2015-02-19 00:00:00 Emerging Europe: Economy Trends Update -- January 2015 by Team of Thomas White International

Emerging European economies witnessed renewed volatility as the New Year unfolded. Russia, the largest of the economies covered in this review, appeared particularly vulnerable as President Putin has not yielded his stance on Ukraine despite the damage inflicted to his country by the Western sanctions and plunging oil prices.

2015-02-19 00:00:00 Global dividends reach new record in 2014 by Alex Crooke (Article)

Alex Crooke reviews the latest Henderson Global Dividend Study (HGDS) findings where he notes global dividends reached a new record in 2014, with the United States leading the charge. Global dividends soared 10.5% to $1.167 trillion in 2014, a new record. Underlying growth was still robust at 8.8%, even with generous special dividends, exchange rate movements and other factors stripped out. The HGDS value reached 159.9 at the end of 2014, meaning that dividends have grown almost 60% in just five years.

2015-02-18 00:00:00 On My Radar: Schumpeter’s Creative Destruction by Steve Blumenthal of CMG Capital Management Group

This week let’s take a look at debt around the globe. I share a great piece from McKinsey & Company that shows just how much more debt, county by country, has been piled on since the 2007 debt induced financial crisis. Evidence is apparent in the commodity market and I also share a few ideas how you may risk manage those allocations.

2015-02-18 00:00:00 The Most Successful Public Company In The World by Gary Halbert of Halbert Wealth Management

Today we focus on the most successful and profitable company in the entire world. It just happens to be an American company, but many of us have never heard of it. If you had invested $1 in this company in 1968, your investment would have soared to $6,638 at the end of last year. I think you’ll be surprised to see which company this is.

2015-02-18 00:00:00 Student Debt: Grading the Threat by Milton Ezrati of Lord Abbett

Could widespread defaults on the $1.2 trillion in U.S. student debt cripple the economy? Not likely.

2015-02-18 00:00:00 A World of Uncertainty by Jerry Wagner of Flexible Plan Investments

After spending over 32 years working in and around the financial services industry, I have come to a realization about one of the most important attributes for investors.

2015-02-18 00:00:00 Global Carry Game Over? by Alexander Giryavets of Dynamika Capital L.L.C.

The world has changed on the 2nd of February after US Personal Income and Outlays report or maybe more importantly ISM Manufacturing Index report got released. The Global Carry trade and Dollar trade got broken and have been broken since. Is it a passing correction or the time is up and the game is over?

2015-02-18 00:00:00 Winter of Discontent or Winding the Spring? by Scott Brown of Raymond James

Retail sales figures disappointed in December and January. The Bloomberg/University of Michigan Consumer Sentiment Index fell back in mid-February. This news has cast some doubt about whether the drop in gasoline prices will propel consumer spending growth in the near term. However, economic data are notoriously unreliable in the winter months. The spring economic data reports should provide a better picture of the underlying strength in jobs, consumer spending, and housing.

2015-02-18 00:00:00 Can Trees Really Grow to the Sky? by Jeffrey Saut of Raymond James

I stopped my rental car in the middle of a cluster of giant sequoia trees while driving to one of my speaking engagements in northern California last week. I have always been overwhelmed with these beautiful “beasts” and last week was no exception. As I lay supine at the base of the behemoth the visual fallacy actually made it look like this monster was indeed growing to the sky. The surreal sensation brought to mind the old stock market axiom, “Trees don’t grow to the sky!”

2015-02-18 00:00:00 Africa Could Mine Its Way to Prosperity if It Addressed Instability by Frank Holmes of U.S. Global Investors

Last week I attended the Investing in African Mining Indaba in Cape Town, South Africa, as both a presenter and a student seeking opportunities. One of the highlights of the conference was former Prime Minister Tony Blair’s keynote address, during which he offered some crucial advice to African governments: To attract and foster a robust mining sector, a commitment to fiscal stability must be made.

2015-02-18 00:00:00 Demystifying - and Defeating - Deflation by Donald Taylor of Franklin Templeton Investments

Consumers who have been raised to fear inflation may find it hard to understand why falling prices could ever be negative. Like many things in life, however, too much of a seemingly good thing sometimes can spell trouble. Donald Taylor, president and chief investment officer, Franklin Equity Group®, US Value, explains why, much like a football or basketball, an economy grappling with deflation is not in its optimal condition.

2015-02-18 00:00:00 Euro-Area Growth: Reasons to be Cheerful by Darren Williams of AllianceBernstein

There are good reasons to be concerned about the medium-term outlook for euro-area growth. But that doesn’t mean the business cycle is dead. We think the conditions for a cyclical rebound in regional growth are currently better than they’ve been at any time since the global financial crisis.

2015-02-17 00:00:00 Why We’re Cautious on Credit by Rob Waldner of Invesco Blog

In the current environment of rising global volatility and potentially weak US corporate earnings growth, Invesco Fixed Income is cautious on US and European credit. While European investment grade credit may be supported by the European Central Bank’s (ECB) program of quantitative easing (QE), we believe US investment grade would likely underperform US Treasuries in the current environment, although we would expect it to perform better than riskier assets.

2015-02-17 00:00:00 Gary Shilling - Why You Should Own Bonds by Robert Huebscher (Article)

If you followed Gary Shilling's advice for the last 30 years, you would be very wealthy. Since 1981, Shilling has consistently advocated owning long-dated Treasury securities. In a talk last week, he reiterated that advice as one piece of his three-part asset-allocation strategy for the coming year.

2015-02-17 00:00:00 Search for Strength: EM Downturn Puts Focus on Fundamentals by Sponsored Content by Invesco (Article)

  • Corporate earnings deterioration and a decline in return on capital have held back emerging market performance.
  • Reversing weak performance depends on a return to stronger corporate earnings.
  • Downside risks could lead to disappointing earnings growth, but positive fundamentals are unfolding.

2015-02-17 00:00:00 Robo-Advisors Are Not New But They Foretell the Future of Financial Advice by Joe Tomlinson (Article)

So-called robo-advisors have been heralded as the next generation of technology that will transform the financial advice industry. Underneath the considerable debate that has emerged over their potential impact, an obvious fact has been overlooked: Much of what they offer is distinctively "old school."

2015-02-17 00:00:00 The Devastation Awaiting Residential Mortgage-Backed Securities by Keith Jurow (Article)

Real estate investment euphoria is widespread. An asset class for which Wall Street has provided little useful information - residential mortgage-backed securities (RMBS) - is especially vulnerable if this euphoria is misplaced.

2015-02-17 00:00:00 The Question that Quadrupled Response Rates by Dan Richards (Article)

Last week, my article described how an advisor uses case studies on tax saving strategies to get in front of prospects. Today, I will discuss the tactic that quadrupled participation in a Red Cross blood drive, and how this technique could increase your success when talking to existing and prospective clients.

2015-02-17 00:00:00 How to Open a Closed Mind by Daniel Solin (Article)

Every advisor knows that sinking feeling that arises when a prospect raises serious objections and a meeting heads downhill. Here's how you can open what appears to be a closed mind.

2015-02-17 00:00:00 Steering Clear of Bad Blood in the Office by Beverly Flaxington (Article)

Two of our advisors openly dislike each other. Is there a graceful way to steer clear of this whole situation?

2015-02-17 00:00:00 Repression, Compression, Expression by Rick Chan of PIMCO

Cumulative financial repression has led to compressed and recently highly correlated yields in most developed countries, while markets have been volatile as investors react and adjust to the new environment. Recent short-term spikes in volatility belie likely damped volatility at these low rates over time, suggesting a potentially attractive opportunity to sell longer-term volatility at current premiums.

2015-02-17 00:00:00 Is Modern Portfolio Theory Dead? by Vern Sumnicht of iSectors

A response to an article titled, “Modern Portfolio Theory is Dead.” The point is to simply ask which of the principles of Modern Portfolio Theory are no longer true. I think it’s more than obvious that these sound principles of investing that have been with us for more than 50 years will be here 50 years from now.

2015-02-17 00:00:00 Wide Disparity in 2014 Stock Returns Shows the Importance of Diversification by Team of Bronfman E.L. Rothschild

With another calendar year in the books, investors can look back to 2014 and see the vast disparity between asset classes, with the U.S. markets leading the way for a second consecutive year. Why not just invest in the S&P 500 Index? The answer is that we don’t know which asset class will be the top performer from year to year. Looking back on the past 15 years, the U.S. has only led three times, with all three coming since 2011, hence the reason for the initial question.

2015-02-17 00:00:00 Tracking the Market with Social Media by Blair Jensen of Trade Followers

As the S&P 500 Index (SPX) made a new closing high this week momentum and sentiment from both Twitter and StockTwits confirmed the move by making a print above their prior peaks. 7 Day momentum from Twitter also has a higher low which indicates a new uptrend is most likely under way.

2015-02-17 00:00:00 European Forecast: Clouds Lifting by Matt Lloyd of Advisors Asset Management

We understand the general public’s concern with regard to Europe. Just when you get your hands around a cease fire in Ukraine, the “Greexit” hits the newsstands with hardline headlines. If this Greek drama ever ends - which is unlikely as we noted two weeks ago detailing Greece’s restructuring –-rescheduling or outright default on debt occurs over 45% of the time since 1800, one still has to deal with the constant threat of a deepening recession.

2015-02-17 00:00:00 Extreme Overvaluation and the Inventory Problem by John Hussman of Hussman Funds

Current equity markets are no place for long-term investors, and even a resumption of risk-seeking investor preferences would demand a considerable safety net.

2015-02-17 00:00:00 Shut off the Noise, Hear the Risks by Gibson Smith of Janus Capital Group

Janus Fixed Income CIO Gibson Smith believes volatility in the fixed income market may represent a greater risk than a sustained increase in rates.

2015-02-17 00:00:00 Keynesian Contrarianism: Where is the Minority Today? by William Smead of Smead Capital Management

To get a good feel for where the largest pools of money are invested around the world and to identify the minority, we draw from the NACUBO-Commonfund Study of Endowments in North America. This year’s survey included $516 billion in investable assets. The results for the fiscal year ended June 30th of 2014 are listed below. Pay particular attention to the largest endowments, because we believe they represent the asset allocation of the largest worldwide institutions.

2015-02-17 00:00:00 Why Equities Should Be in Your Portfolio by (Article)

What kind of total return could the market produce this year? Portfolio Manager Charlie Dreifus believes owning a portfolio of high-quality companies looks more attractive than the alternatives.

2015-02-17 00:00:00 Learn About CEFs by (Article)

Learning more about closed-end funds may help financial advisors be even more successful with clients, says Anne Kritzmire of Nuveen Investments and CEFA.

2015-02-17 00:00:00 EM Sector Featuring Ryan Paylor by (Article)

The emerging market sector, especially Latin America, presents potential opportunity to CEF investors, says Ryan Paylor, of Thomas J. Herzfeld Advisors.

2015-02-17 00:00:00 High Yield Bond CEFs Featuring John Cole Scott by (Article)

High yield bond closed-end funds may be “overdone” by investors, says John Cole Scott of CEF Advisors.

2015-02-17 00:00:00 What Does the Current Low Interest Rate Environment Mean for Agency MBS? by Mike Cudzil, Daniel Hyman of PIMCO

After the agency MBS market in 2014 was dominated by low volatility, limited prepayment risk and strong performance, the strong rally in U.S. Treasuries in January resulted in just the opposite. With the Fed ending net purchases of MBS in October 2014, it seems unlikely for the private investment community to take the Fed’s place in the MBS market at this level of interest rates and spreads. PIMCO expects the environment for MBS in 2015 to be quite the opposite of 2014, resulting in higher volatility, cheaper valuations and more attractive excess return opportunities for the active manager.

2015-02-17 00:00:00 Investor Sentiment Is Strengthening by Robert Doll of Nuveen Asset Management

U.S. equities finished higher for a second straight week, with the S&P 500 Index gaining 2.1% as it ended the week at a record high.1 Investors largely shrugged off disappointing retail sales figures and chose to focus on the positives.

2015-02-17 00:00:00 QE and Currency Wars: A Theory With No Evidence by Brian Wesbury, Robert Stein of First Trust Advisors

Some analysts think that central bank policy (specifically, quantitative easing) is the only thing that matters. They overlook innovation, investment, and just plain old hard work and argue that stock prices, interest rates and economic performance are driven by central bank stimulus. These analysts say the world has returned to a Depression-era game of competitive devaluation (some call it “currency wars”).

2015-02-17 00:00:00 U.S. Dollar Strength Continues to Impact U.S. Multinationals by Jeremy Schwartz of WisdomTree

S&P 500 Index has traded inversely to the currency moves over recent years, and it has become increasingly negatively negatively correlated. One reason, we believe, is that a growing share of revenue and profits for U.S. corporations comes from overseas—and that share seems likely to increase with the globalization of the economy.

2015-02-17 00:00:00 Is That Leveraged ETF Worth It? Comparing SSO and VOO by Team of GaveKal Capital

As ETFs control a larger number of assets under management, it is no surprise that the options available to investors are getting ever more exotic. One of the early examples (and thus we actually have history available) of exotic ETFs are leveraged ETFs. Leveraged ETFs attempt to to mimic the daily change in an index, in today's case the S&P 500, by a defined multiple (i.e. 2x, 3x, etc). Today, we will look at one of the more highly used leveraged ETF: Proshares Ultra S&P 500 (ticker: SSO).

2015-02-15 00:00:00 Self-Sustaining US Economy…So What Now? by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

The US economy appears to be in a self-sustaining phase of the expansion, which could mean more volatility as the Fed embarks on a tightening cycle. We remain confident the secular bull market is intact, but volatility has risen and we suggest investors who are over-exposed to US equities consider global diversification, with a preference for emerging markets. Europe appears to be stealthily improving, but Greece remains a flash point and Eurozone equity markets may have gotten ahead of themselves a bit.

2015-02-15 00:00:00 Weighing the Week Ahead: Will Energy Stocks Support the Market Breakout? by Jeff Miller of New Arc Investments

I do not know whether we have reached a bottom in energy prices, but I have identified two important themes.

2015-02-15 00:00:00 Mamas, Don’t Let Your Babies Grow Up to Be Pension Fund Managers by John Mauldin of Mauldin Economics

We do not have to look to Greece to find massively underfunded obligations. Here in the US we can find hundreds of examples, willingly created by politicians and businessmen who proclaim they are working for the public good. We call them pension funds, but they’re just another form of unfunded debt. A sovereign bond is a promise to pay a certain amount of money over time.

2015-02-14 00:00:00 The Fat Pitch Weekly Market Summary by Urban Carmel of The Fat Pitch

So there are a number of positives that suggest indices will continue broadly higher. But there a few other considerations that are potentially negative.

2015-02-14 00:00:00 The Daily X-Change - 3 Things - Uncomfortable Facts, 25-54 Employment, Houston RE by Lance Roberts of Streettalk Live

While the media and mainstream analysts discount the negative economic impact of falling energy costs, I have personally witnessed it in the mid-80's, the late 90's and just prior to 2008. In all cases, the negative outcomes were far worse than predicted which left economists scratching their heads as to what went wrong with their models. Of course, considering the BLS only saw a loss of 1900 manufacturing (oil and gas) jobs in January when there were 26,000 layoffs may explain part of the problem.

2015-02-14 00:00:00 Alternate Current: The Power of Diverse Return Sources by Christine Johnson of AllianceBernstein

After a long period of calm, global markets now face tumbling oil prices, geopolitical risks and monetary policy changes. Investors looking for new ways to diversify in this uncertain environment should take a long look at investments that don’t take their cues from stock or bond market movements.

2015-02-14 00:00:00 When Patience Disappears by Scott Minerd of Guggenheim Partners

Advance notice of the timing of a rate hike by the Federal Reserve may hinge on the removal of just one word, warns St. Louis Fed President Bullard.

2015-02-14 00:00:00 Bonding with Diversification by Rick Rieder of BlackRock

With the fixed income landscape poised for a makeover, Rick Rieder discusses the importance of diversification.

2015-02-14 00:00:00 Anatomy of a Down Market by Rob Isbitts of Sungarden Investment Research

As with all professional investors, we have an opinion about where the market is going, over the next few months and years, and even longer. Such forecasts do not contribute meaningfully to the investment decisions we make at Sungarden. Rather, our investment committee tries to focus on what is right in front of us. Instead of investing for a specific outcome, we gauge the possibilities, evaluate the tradeoff between reward and risk, and plan for anything.

2015-02-14 00:00:00 ECRI Recession Watch: Weekly Update by Doug Short of Advisor Perspectives (dshort.com)

Today's new release of the publicly available data from the Economic Cycle Research Institute (ECRI) puts its Weekly Leading Index (WLI) at 130.0, down from 130.8 the previous week. The WLI annualized growth indicator (WLIg) is at -4.3, down slightly from the previous week's -4.0, but up from the interim low of -5.0 in mid-January.

2015-02-13 00:00:00 DC Managed Accounts: Shining a Spotlight on Investment Advice by Steve Ferber, Michael Esselman of PIMCO

?Nearly one in three defined contribution (DC) plans offers managed account and automated advice services that attempt to enhance investment outcomes with personalized advice. As the Government Accountability Office has reported, however, plan sponsors often have had limited or insufficient information to evaluate and monitor automated advice engines, despite having fiduciary responsibility over advice provided to participants.

2015-02-13 00:00:00 47% of the MSCI World Index Is In A Correction (At Least) by Team of GaveKal Capital

Regular readers know we like to slice the market internal data in a many different ways because a lot of the time the cap-weighted indices aren't a proper representation of what is going on with the majority of stocks. With this in mind, one of the ways we like to measure what is going on underneath the surface is to take a percentage of stocks that are trading at levels less than 10% off its 200-day high, 10-20% off its 200-day high, 20-30% off its 200-day high and greater than 30% off its 200-day high.

2015-02-13 00:00:00 Global Airline Stocks Soaring, and Not Just Because of Low Oil Prices by Frank Holmes of U.S. Global Investors

The airline industry is notoriously competitive. There’s even an old joke: If you want to make a million dollars in the airline business, you need to start with two million.

2015-02-13 00:00:00 One Cheer for India: Hip, Hip but no Hooray? by Sudarshan Murthy of Matthews Asia

There has been a sense of optimism lately over India’s place in the world, and its markets demonstrated some enthusiasm over the seemingly good chemistry between U.S. President Barack Obama and Prime Minister Narendra Modi. But should investors beware of chasing price momentum?

2015-02-13 00:00:00 January Jobs Data - Good, but Slack Remains by Scott Brown of Raymond James

Contrary to what you may have heard, the U.S. economy did not add 257,000 jobs in January. That’s the seasonally adjusted figure. We actually lost 2.755 million jobs, which was a smaller decline than the year before (-2.811 million).

2015-02-13 00:00:00 From Russia with Love? by Jeffrey Saut of Raymond James

The big news late last week was German Chancellor Angela Merkel’s and French President Francois Hollande’s emergency trip to Russia for peace talks with President Putin. Obviously, the situation in the Ukraine is heating up again or such Herculean efforts would not be undertaken.

2015-02-13 00:00:00 Three Surveys Show US Consumers Feeling Friskier by Brian Horrigan of Loomis Sayles

US consumers are feeling friskier according to recent data. Consumers appear to have, at long last, shaken off the “blues” they suffered on account of the severe recession of 2007-2009 and the subsequent slow recovery. I don’t think we can attribute the improved consumer outlook to any one factor, but rather from a combination of factors: over a year of solid payroll growth, improving wage gains, a plunge in gasoline prices, rising stock and house prices, and low interest rates.

2015-02-13 00:00:00 The dshort Economic Calendar, Miami Style by Doug Short (Article)

Note from dshort: I'm in semi-vacation mode in southern Florida for the next few days. My routine updates on economic indicators will be posted on a somewhat delayed basis.

Today we spent Friday on a touring the Fairchild Topical Gardens a few miles south of Miami, 83 acres of amazing rare tropical plants including palms, cycads, flowering trees and vines. The gardens are all the more spectacular with the current exhibition of works by American artist Dale Chihuly.

2015-02-12 00:00:00 President Obama's tax proposal: What equity investors need to know by Michael Allison of Eaton Vance

In this insight, Michael examines the potential for higher tax rates on long-term gains and dividends and makes the case for taking a tax-managed approach to equity investing.

2015-02-12 00:00:00 Europe: The Road to Recovery? by John Canally of LPL Financial

Although it is too soon to gauge the effectiveness of QE in the Eurozone, key readings and data are beginning to show improvement, and consensus expectations are for continued growth in 2015. However, Market participants looking for an immediate and sustained response by the Eurozone economy to QE may be disappointed. The renewed political and fiscal uncertainty in Greece will be watched closely by market participants in the coming weeks and months.

2015-02-12 00:00:00 Rising Interest Rates & Long Term Stock Returns by Lance Roberts of Streettalk Live

With the Federal Reserve now indicating that they are "really serious" about raising interest rates, there have come numerous articles and analysis discussing the impact on asset prices.

2015-02-12 00:00:00 On My Radar: Go Ahead Angela, Make My Day by Steve Blumenthal of CMG Capital Management Group

I spend a great deal of time writing about valuations, probable future returns (near record lows today), portfolio construction and risk management. Reflecting on four days of non-stop sessions, media interviews and meetings at the Inside ETFs Annual Conference this past week, I thought I’d share several key takeaways with you.

2015-02-12 00:00:00 Is Skill Dead? by Neil Constable, Matt Kadnar of GMO

As investment boards and committees gather to discuss performance for 2014, eyebrows will most certainly be raised as people review the performance of many of their equity managers. Depending on which database they are looking at, between 80% and 90% of active U.S. equity managers will have underperformed their benchmark this year, making it one of the worst years for active management in the recent past.

2015-02-12 00:00:00 Sector Insights: Technology by Steve Jue of Rainier Investment Management

With cloud computing, mobile Internet, the “Internet of Things” and next-generation security, recent trends in technology are driving innovation and are creating attractive opportunities for investors.

2015-02-12 00:00:00 Scott Mather Discusses PIMCO’s Total Return Strategy by Scott Mather of PIMCO

Bonds have continued to rally so far this year, even as the Federal Reserve contemplates raising interest rates. In the following interview, Scott Mather, CIO U.S. Core Strategies, discusses recent developments in the bond markets, the outlook for the year ahead and the investment implications for PIMCO’s Total Return Strategy. Mather co-manages the strategy with Mark Kiesel, CIO Global Credit, and Mihir Worah, CIO Real Return and Asset Allocation.

2015-02-12 00:00:00 Alpha Generation for Active Managers by Heather Rupp of AdvisorShares

As we discussed in our recent blog (see “The Opportunity in Volatility”), we are currently seeing a lot of attractive opportunities in the high yield market—discounts and yields that we haven’t seen in some time. And while we have seen the yields in the high yield indexes and the products that track them increase over the last six months, they don’t really seem to reflect the true opportunity we are seeing in the market.

2015-02-11 00:00:00 Will China’s Year of the Goat Bring Out the Market Bulls? by Eddie Chow of Franklin Templeton Investments

According to the Chinese calendar, 2015 is the Year of the Goat (or sheep), creatures that are typically peaceful in nature but can also be stubborn, while exhibiting herd-like behavior. I’ve invited my colleague Eddie Chow, senior executive vice president and managing director, Templeton Emerging Markets Group, to share his perspective on some key themes our team is watching in 2015 for China, and whether we think market bulls, bears or goats can be friends this year.

2015-02-11 00:00:00 Earnings Season Highlights and Lowlights by Burt White of LPL Financial

In this commentary we look at some of the highlights and lowlights of fourth quarter earnings season. Despite the massive drag from the energy sector and the negative impact of a strong U.S. dollar, fourth quarter 2014 earnings are on track to exceed prior estimates. We maintain our 5?-?10% earnings growth forecast for 2015* and believe cheaper energy costs will help us get there.

2015-02-11 00:00:00 Deflation Is Spreading In Europe - Is America Next? by Gary Halbert of Halbert Wealth Management

US consumer prices fell in December by the largest amount in six years, reflecting another big monthly decline in gas prices and providing further evidence of falling inflation pressures. The Labor Department said Friday that its Consumer Price Index dropped 0.4% in December, the largest one-month drop since December 2008. It was also the second straight monthly decline in prices with both months reflecting big decreases in gasoline prices.

2015-02-11 00:00:00 The Bond Market in 2015: Mind the (Price) Gaps by Kathleen Gaffney of Eaton Vance

In this insight, Kathleen reviews her outlook for the bond market and explains how a multi sector bond approach could turn rate hike volatility into opportunity for patient investors.

2015-02-11 00:00:00 Repression Investing: Got Gold? by Axel Merk of Merk Investments

Gone are the ZIRP days – the ‘Zero Interest Rate Policy’ is being replaced by negative interest rates in various countries. ZIRP is a form of financial repression, where savers earn less than the inflation rate to discourage saving. Pundits suggest the U.S. has chosen a different course, as ‘liftoff’ may soon take U.S. rates higher. We’ll try to separate reality from fiction, discussing investment implications for the U.S. dollar and gold.

2015-02-11 00:00:00 Did the 2014 Volatility Create a 2015 Opportunity? The Outlook for High Yield by Chad Gunther of Ivy Investment Management Company

The tumbling oil market put junk bond prices On a slippery slope in late 2014. Total returns on high-yield bond indexes tracked by Barclays fell into negative territory in mid-December for the first time since 2011, as investor fear about downside risk associated with energy-related junk bonds spilled over into the rest of the high-yield market. While the slide in high-yield valuations may have disappointed some investors, Ivy High Income Portfolio Manager Chad Gunther believes it created some potentially attractive opportunities in the high-yield credit market. Below he shares his views.

2015-02-11 00:00:00 Investing Lessons from the Super Bowl by Jerry Wagner of Flexible Plan Investments

Super Bowl losing teams are usually quickly forgotten—consigned, as the expression goes, to history’s dustbin. In fact, some NFL historians and coaches have said that the losers of the semi-finals (conference title game) have often received more long-term recognition than the Super Bowl losers, for the simple reason they may have played the Super Bowl winner much tougher in the earlier round.

2015-02-11 00:00:00 Positive Economic Surprises in Europe, Negative in the U.S. by Team of GaveKal Capital

The Citi Economic Surprise index is a quick way to get a high-level look at the condition of economic data around the world. Calculated as a diffusion index, values generally range between 100 and -100 for the overall index, which is currently right in the middle of that range.

2015-02-11 00:00:00 China Just Crossed a Landmark Threshold by Frank Holmes of U.S. Global Investors

Back in July 2013, the think tank Heritage Foundation predicted that China’s outbound investment “could very well exceed $80 billion [by the end of the year] and is on course to breach $100 billion by about 2016.”

2015-02-11 00:00:00 The Sectors Now on Shaky Ground by Russ Koesterich of BlackRock

Bond yields surged last week, putting some dividend-rich stocks (utilities, REITs) in a very vulnerable position. Could this be the end of their rally?

2015-02-11 00:00:00 Don’t Count High Yield Out in 2015 by Gershon Distenfeld of AllianceBernstein

Fears about higher US interest rates, rising defaults and a multi-month decline in the price of oil have injected a dose of high anxiety into the high-yield market. But we still think investors will be better off this year if they stand their ground and stay invested.

2015-02-10 00:00:00 Harold Evensky - Nine Key Communication Points by Robert Huebscher (Article)

Advisors should put their mouths where their money is, according to Harold Evensky. Educating and preparing clients for what advisors will ultimately deliver must be a core principle of every practice. In a recent presentation, Evensky described nine key ways that advisors should interact with clients, the media and their peers.

2015-02-10 00:00:00 An In-Depth Look at the Tweedy Browne Value Fund by Larry Swedroe (Article)

Tweedy Browne has long been one of the most respected and iconic names in the mutual fund industry. But, over the long term, has the firm's flagship fund outperformed a passive benchmark?

2015-02-10 00:00:00 Mohamed El-Erian: Beware the Bubble in Liquidity by Robert Huebscher (Article)

In 2000, it was technology stocks. In 2007, it was real-estate prices. Among today's overvalued asset classes, which one will crash most spectacularly when the bubble bursts? Mohamed El-Erian, the chief economic advisor at Allianz, thinks he knows the answer.

2015-02-10 00:00:00 Curiosity-free Research by Michael Edesess (Article)

You come across an article that won the Financial Analyst Journal's award for best paper of 2013. You tracked it down from something you saw recently in The Economist. It is written by two Yale professors and two researchers at investment management firms - a good mix of academics and practitioners. Is it safe to assume that it provides reliable information about how to invest one's savings?

2015-02-10 00:00:00 Getting Prospects to Meet by Dan Richards (Article)

While prospective clients are pressed for time, the core issue is that many advisors fail to convey a big enough payoff when asking for the time to meet. After all, everyone can find 45 minutes if they really want to. So, how can you create urgency around your request?

2015-02-10 00:00:00 How to Generate More "Warm" Referrals by Daniel Solin (Article)

For many advisors, the issue isn't converting prospects into clients, but rather generating more leads. A recent article offered some helpful suggestions on how even small advisory firms can generate a flood of new prospects.

2015-02-10 00:00:00 Freeing Up Time for Growth Activities by Beverly Flaxington (Article)

We devote most of our time to client communications and portfolio changes. These are the activities that fuel business, so I am reluctant to spend less time doing them. My preference would be to provide the same level of investment and client service but to find time to grow as well. Do you any tips for me?

2015-02-10 00:00:00 Why Building Trust is the Top Priority in 2015 by Robin Powell (Article)

I have long advocated using high-quality, engaging content to build trust and attract and retain more clients. Your content reflects - or should reflect - you and your values and it has to take center stage in your firm's marketing strategy.

2015-02-10 00:00:00 Questions Remain After Blowout Employment Report by Lance Roberts of Streettalk Live

I like to think of myself as a pretty simple guy. I don't like complexity or complications, but most importantly I like things to make sense. The latest employment report, which showed a surge in employment in recent months, left me with more questions than answers.

2015-02-10 00:00:00 Weighing the Week Ahead: Time for “Risk On?” by Jeff Miller of New Arc Investments

With a modest schedule of data releases, we can expect more analysis of last week’s news. Trading in several markets changed course rather abruptly. With traders poised to spot any change in trend, the question will be whether this shift is for real.

2015-02-10 00:00:00 Greece Dependency Has Created Dangerous Illusions by John Browne of Euro Pacific Capital

Once again the crisis in Greece is threatening the unity of the entire euro zone. Many analysts are asking what must be done to restore viability to the Union's weakest link. Lost in this discussion is that modern Greece, formed in 1830, has never really been required to stand on its own. Generations of support from abroad, typically given for strategic reasons, has created a false sense of prosperity in the country and has prevented the Greeks from accepting the realities of their current situation.

2015-02-10 00:00:00 Greek Games by Bill O'Grady of Confluence Investment Management

After the Syriza party won 149 of the 300 seats in the Jan. 24th Greek elections, European markets have been roiled by worries over another crisis developing. In this report, we use game theory to describe the situation between Greece and the EU/Germany/ECB. This method shows how misunderstandings can develop and how catastrophic mistakes are made. Using this structure, we will outline the positions and perceptions of both sides and describe how this situation could lead to another crisis. As always, we will finish with market ramifications.

2015-02-10 00:00:00 Currencies: What to Watch for after the Swiss Surprise by Milton Ezrati of Lord Abbett

Switzerland’s decision to scrap the franc-euro peg has grabbed the headlines, but the bigger story remains the continued dominance of the U.S. dollar.

2015-02-10 00:00:00 Recession Probability Models - February 2015 by Ted Kavadas of StratX, LLC

There are a variety of economic models that are supposed to predict the probabilities of recession.

2015-02-10 00:00:00 Evensky & Katz Newsletter by Harold Evensky of Evensky & Katz

Harold Evensky presents his quarterly newsletter.

2015-02-10 00:00:00 Riding An Aging Bull (Market) by Rick Vollaro of Pinnacle Advisory Group

The year has begun in roller coaster fashion, and our team has been busy reading and digesting the many 2015 outlooks that come across our desks. But reading is the easy part, and now it’s our turn to distill the many facets of our process into a workable thesis that allows us to generate attractive risk-adjusted returns in this maturing market cycle.

2015-02-10 00:00:00 An Accidental Currency War? by Mohamed El-Erian of Project Syndicate

Six and a half years after the global financial crisis, central banks in emerging and developed economies alike are continuing to pursue unprecedentedly activist – and unpredictable – monetary policy. How much road remains in this extraordinary journey?

2015-02-09 00:00:00 Surprises in 2014 and Expectations for 2015 by (Article)

Portfolio Manager and Principal Charlie Dreifus talks about the global slowdown in 2014 and its effects on interest rates in the U.S. and abroad, how data points for the U.S. economy and quantitative easing in the eurozone will play a big role in shaping the investment landscape in 2015, and how - with interest rates so low - wage inflation could have a positive impact on the markets.

2015-02-09 00:00:00 Outlook and Positioning by Alex Crooke (Article)

Alex Crooke, Head of Global Equity Income, provides a review of the Henderson Global Equity Income Fund's (HFQAX) recent performance and current positioning as well as providing an update on recent events in Europe. Alex notes that the action of the ECB (European Central Bank) starting a quantitative easing (QE) program as the most significant factor driving markets over the next 6 months. While he believes the program will be a slow modest start with monthly purchases around 60trillion Euros, it should gain traction over the next year or two.

2015-02-09 00:00:00 Revisions to the Nonfarm Payroll Jobs Report by Doug Short (Article)

In my latest Employment Update for January, I pointed out that the Bureau of Labor Statistics revised the December month-over-month change for Nonfarm Payroll Employment upward from 252K to 329K and November from 353K to 423K, a total of 147K to the upside. However, the BLS's initial estimate for this metric should be taken with the proverbial grain of salt. In this chart, I plot the change since the turn of the century from the first to third estimate for each month through November 2014, the most recent month for which we have three estimates.

2015-02-09 00:00:00 Bonds or Jeter? by Richard Bernstein of Richard Bernstein Advisors

In baseball, batters choose to either swing for the fences in hopes of a home run or go for more consistent base hits. These same principles are highly relevant to the current market environment and long-term investment success. So, see if you really want home run hitters in your portfolio?

2015-02-09 00:00:00 The International Ramifications of ECB QE by Andrew Bosomworth of PIMCO

By engaging in quantitative easing, the European Central Bank is pursuing its inflation mandate with a vengeance. Overall, we think the combination of quantitative easing, investment and lower oil prices will help eurozone growth reach approximately 1.3% in 2015. Global central bank balance sheets continue to expand: Although the Federal Reserve stopped purchasing assets in 2014, the Bank of Japan and now the ECB have stepped up buying bonds where the Fed left off.

2015-02-09 00:00:00 Leaning in to Headwinds and Headlines by Matt Dennis of Invesco Blog

There’s been no shortage of headlines focused on European volatility lately, and the current consensus is that Europe is the last place investors want to put money. The risk for investors in my mind, however, is that they follow the headlines and exit Europe now instead of leaning into the headwinds of consensus and building positions.

2015-02-09 00:00:00 Tracking the Market with Social Media by Blair Jensen of Trade Followers

Traders on Twitter and StockTwits are still waiting for a break of the current range before making any commitment to the market. As the S&P 500 Index (SPX) has oscillated in a range between 1990 and 2065 the Trade Followers momentum and sentiment indicators have continued to fall. The StockTwits community is getting more bearish as the range continues. The new up trend line from StockTwits has been broken to the downside which indicates there was no enthusiasm for last week’s rally.

2015-02-09 00:00:00 All the Children Are Above Average by Harley Bassman of PIMCO

Many investment strategies are centered upon discovering a long-term (average) valuation framework to help in asset allocation and security selection. The term surface of various risk parameters often moves in such a manner that the discounted forward value will point toward this long-term average. If a secular shift has taken place - if all the children are above average, so to speak - then maybe the “average” has changed.

2015-02-09 00:00:00 Questions Remain After Blowout Employment Report by Lance Roberts of Streettalk Live

I like to think of myself as a pretty simple guy. I don't like complexity or complications, but most importantly I like things to make sense. The latest employment report, which showed a surge in employment in recent months, left me with more questions than answers.

2015-02-08 00:00:00 The Eurozone: Collateral Damage by John Mauldin of Mauldin Economics

Now we're watching another Greek drama that could have significant unintended consequences – far beyond anything the market has priced in today. Then again, maybe not. Maybe the market is right this time. When we enter unknown territory, who knows what we will find? Fertile valleys and treasure, or deserts and devastation? Today we look at the situation in Europe and ponder what we don't know. Greece provides a wonderful learning opportunity.

2015-02-08 00:00:00 Expect a Decade of 1.7% Portfolio Returns from a Conventional Asset Mix by John Hussman of Hussman Funds

The problem for investors here is that risk premiums are compressed in equities at a time when bonds offer no way out. When risk premiums are compressed across the board, conventional asset allocations are very much like trying to squeeze water from a stone. We project a 10-year nominal annual portfolio total return averaging only about 1.7% annually for anything close to a standard portfolio mix of equities, bonds and cash, regardless of how much diversification one has within each of those asset classes.

2015-02-07 00:00:00 The Fat Pitch Weekly Market Summary by Urban Carmel of The Fat Pitch

SPX has now fallen 4 of the last 5 weeks, including this past one. For the week, SPX and DJIA each lost nearly 3% and NDX lost 0.8%.The indices and most of the sectors have fallen under their key moving averages. Many of these now have a declining slope. Over the past month, price has made lower highs. All of this suggests that the trend is down. Moreover, bullish set ups are failing, a warning that price has not reached an oversold level. Despite the sell off, breadth and longer term measurements of sentiment have not washed out to an extent that would suggest a low is in place.

2015-02-07 00:00:00 The Power of Lower Oil Prices by Byron Wien of Blackstone

The Ten Surprises of 2015 have two prevailing themes. The more dominant is that the decline in the price of oil is generally a positive for the world. It puts money in the pockets of consumers everywhere and it is likely to force Iran and Russia to be more conciliatory in geopolitical negotiations because both countries are suffering not only from the drop in the oil price, but also from the sanctions imposed on them. The second theme is that in spite of notable economic problems in Europe, China and Japan, the United States equity market will have another good year.

2015-02-06 00:00:00 Earnings of Private Employees: A Big Recovery in January by Doug Short (Article)

First, here is a chart of the Average Hourly Earnings. I've included a linear regression through the data to highlight the trend. Hourly earnings increased at a faster pace through 2008, but the pace slowed from early 2009 onward. The December data point was a bit disturbing, a 5 cent month-over-month decline, the largest decline in the history of the series. However the January data point is a big bounce of 12 cents, the largest increase in the series.

2015-02-06 00:00:00 Diving Into the Payroll Report: Wages Rebound (But Don't Get Too Excited), Revisions, Huge Jump in L by Mike Shedlock of Sitka Pacific Capital Management

Wages rebounded from the dip last month (but don't get too excited as per details below). Also, there were big upward revisions to many prior numbers. The unemployment rate rose this month because of a huge increase in the labor force. The civilian institutional population also leaped this month, and apparently these newly-found people are all looking for work.

2015-02-06 00:00:00 Oil Prices: The Petro Plunge Continues in January 2015 by Harish Sundaresh of Loomis Sayles

Crude oil spot prices have dropped in a straight line to around $50 per barrel with no semblance of consolidation since the second half of 2014. In the near-term, weak supply/demand balance, high inventory, poor demand and a risk-averse investor could mean that oil prices will remain depressed.

2015-02-06 00:00:00 Fixed income macro and portfolio update by John Pattullo, Head of Retail Fixed Income (Article)

John Pattullo, Head of Retail Fixed Income, co-lead portfolio manager for the Henderson Strategic Income Fund (HFAAX) gives an appraisal of the macro environment and explains the current themes within the portfolio. John also shares his thoughts on recent announcement of quantitative easing (QE) made by the European Central Bank (ECB), the Greek vote and issues in the energy sector.

2015-02-06 00:00:00 Global Opportunities: The Next Leap Forward for Defined Contribution Investment Menus by Charles Roth of Thornburg Investment Management

Under ERISA, fiduciaries are obligated to ensure plan menus provide diverse investment options to help minimize the risk of long-term losses in account values. Global, non-traditional equity and fixed income options are sorely lacking in Defined Contribution (DC) plan menus. These op-tions can offer both lower correlation to U.S. markets and potentially strong returns, which par-ticipants increasingly need given the uncertainty surrounding Social Security’s future benefit levels.

2015-02-06 00:00:00 The Good News Behind GDP's Decline by Team of Guggenheim Partners

As the U.S. economy maintains its momentum and with the euro zone showing signs of improvement, all eyes are now on the Fed’s next move on rates.

2015-02-06 00:00:00 Quarterly Letter by Team of Grey Owl Capital Management

Over the past seven months the price of oil has plunged from a peak above $100/barrel to the mid-$40s today. This is just the most extreme version of the market volatility and divergence we began highlighting in our second quarter letter. A cautious investment stance remains the prudent choice.

2015-02-06 00:00:00 Metaphors and the message: Searching for deeper understanding of investment information by David Robertson of Arete Asset Management

Metaphors have a powerful influence on how we think about things and even on the evidence we consider important. Investors should be aware of this influence and how it shapes the way we perceive various messages and data points. An important application is to focus on metaphors that are consistent with your investment goals and philosophy.

2015-02-06 00:00:00 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Not everyone is happy about the dollar’s recent strength; Debt negotiations between Greece and its creditors are off to a rocky start; Wages may finally be reflecting the strong U.S. employment picture

2015-02-06 00:00:00 Outcome Investing: Blending Index and Active Strategies by Russ Koesterich of BlackRock

There is a lot to consider when building a portfolio. First and foremost, what is the end goal? Beyond that, investors need to also consider how much risk to take and over what time horizon? Another question that frequently comes up and is the source of many contentious debates: Should I consider indexed or active products? The simple and important answer is: both.

2015-02-06 00:00:00 A Contrary Opinion On The US Employment Report by Team of GaveKal

One of the main features of the current recovery is the drop in the potential growth rate. In every other recovery since WW2, real GDP has risen back to potential as the recovery got going, thereby closing the output gap. This time around, the output gap has narrowed because potential GDP has been revised down. This is an important point to understand when looking at today's jobs report.

2015-02-06 00:00:00 Key Questions for China Investors in 2015 by Andy Rothman of Matthews Asia

China raises many questions for investors. Last year, for example, GDP growth slowed to 7.4% from 7.7%, but China still accounted for almost one-third of global growth. Is this a healthy economy or an impending disaster? In the first of a three-part Sinology series, Andy Rothman, Matthews Asia Investment Strategist, addresses some key investor concerns.

2015-02-06 00:00:00 Inflation Expectations Have Increased Since Mid-January by Team of GaveKal

Since January 15th, 5-year TIPS derived breakeven inflation has increased 23 basis points from 105 basis points to 138 basis points. 10-year TIPS derived breakeven inflation has increased 16 basis points during this time and 30-year TIPS derived breakeven inflation has increased 8 basis points since the beginning of February.

2015-02-06 00:00:00 Active Opportunities in a Passive World by Norman J. Boersma, Cindy L. Sweeting and Heather Arnold of Franklin Templeton

Investors have heard the drumbeat for years that the days of actively managed mutual funds are numbered. After all, some experts maintain, the performance of active funds, especially after fees are removed, typically fall short of those of passive index funds, especially when the stock market is on an upswing. But the authors contend, with apologies to Mark Twain, that reports of the demise of actively managed funds have been greatly exaggerated. And, with the help of some prominent academics, they make the case for staying active.

2015-02-06 00:00:00 ECRI Recession Watch: Weekly Update by Doug Short of Advisor Perspectives (dshort.com)

Today's new release of the publicly available data from the Economic Cycle Research Institute (ECRI) puts its Weekly Leading Index (WLI) at 130.8, down from 131.6 the previous week. The WLI annualized growth indicator (WLIg) is at -4.0, up from the previous week's -4.3 and the interim -5.0 low in mid-January.

2015-02-06 00:00:00 Should I Stay or Should I Go: Global Diversification Could be 2015’s Winner by Liz Ann Sonders of Charles Schwab

Last year ended on a weak note for US equities; and January continued the trend; Divergences will remain a theme and likely keep volatility elevated; US investors haven’t felt the need to diversify globally…they should

2015-02-06 00:00:00 Detroit Reorganizes. The Muni Market Takes Notes. by Joseph Rosenblum of AllianceBernstein

Stockton. San Bernardino, California. Jefferson County, Alabama. Over the past few years, municipal bankruptcies (Chapter 9) have captured headlines. Detroit’s case, the largest municipal bankruptcy in history, was recently settled. What have we learned? Here are four key take-aways for muni market investors.

2015-02-06 00:00:00 China’s Millennials: Have Money, Will Travel by Sammy Suzuki of AllianceBernstein

China’s millennials are better educated and more affluent than their elders. They also have a serious case of travel fever. Their favored destinations, and shopping habits abroad, could have far-reaching implications for a wide range of global companies.

2015-02-06 00:00:00 High-Yield ETFs: Don’t Get Fenced In by Gershon Distenfeld of AllianceBernstein

Few high-yield investors have weathered the recent plunge in energy prices without experiencing at least a few bumps and bruises. But those who relied on broad market exchange-traded funds (ETFs) to gain market exposure are nursing the most serious wounds. Coincidence? We don’t think so.

2015-02-06 00:00:00 After the Perfect Storm in US Smaller-Cap Stocks by Bruce Aronow of AllianceBernstein

Last year was a tough one for US small- and mid-cap stocks, but there’s reason to think 2015 may be different. For investors who trimmed their smaller-cap allocation last year, we think it may be time to consider taking it back to its long-term target.

2015-02-06 00:00:00 Worried About US Stocks? by Joseph G. Paul of AllianceBernstein

After a jittery January, investors in US equities are gritting their teeth. But even if equities lose some steam after last year’s rally, we think company fundamentals and the interest-rate environment should support a resilient market in 2015.

2015-02-05 00:00:00 Macro View: Good Company, Bad Stock by Team of Guggenheim Partners

The U.S. economy is strong relative to other countries, but its equity valuations mean less upside potential for long-term investors than other areas of the world.

2015-02-05 00:00:00 Your Alpha is My Beta by Adam Butler, Mike Philbrick and Rodrigo Gordillo of Butler|Philbrick|Gordillo & Associates

A couple of weeks ago, I had the pleasure of a short correspondence with Lars Kestner, a well known quant and derivatives trader, and creator of the thoughtful K-ratio as a measure of risk adjusted performance. We connected on the definition of alpha, and how the term has been so abused in media and marketing as to become almost meaningless.

2015-02-05 00:00:00 Why own bonds? by Anthony Valeri of LPL Financial

A soft start for the U.S. stock market in 2015 once again illustrates the diversification benefit of high-quality bonds even at very low yields. Even in a low-yield environment, bonds provide a cushion as price movements, not yields, are the primary buffer to equity movements. An allocation to core bonds, in addition to more attractively valued high-yield bonds, may make sense for investors.

2015-02-05 00:00:00 The 2015 Economic Outlook: Opportunities and Risks by Derek Hamilton of Ivy Investment Management Company

In 2014, the global economy grew at roughly the same pace as the prior year. However, the composition was notably different. Developed market economies grew at a faster pace, while growth slowed in emerging market economies. The dollar strengthened and commodity prices weakened. Overall, we expect these trends to continue in 2015.

2015-02-05 00:00:00 Is the stock market sliding off an icy road? by Jerry Wagner of Flexible Plan Investments

As declines were registered in the major stock market indexes in December, the fear index certainly also increased among investors. Now with January, again, ending in the negative column, I imagine even more investors are beginning to fear that the bull market surge that began in 2009 may be coming to an end.

2015-02-05 00:00:00 Germany's "Time Pressure" Thesis; Noose Tightens on Europe by Mike Shedlock of Sitka Pacific Capital Management

Today German Chancellor Angela Merkel proclaimed Greek Diplomatic Offensive Is Failing. Merkel’s Christian Democratic-led bloc in parliament has agreed not to give in to any “bad compromise that “defacto adds up to a debt writedown,” Hans-Peter Friedrich, a deputy leader of the caucus, said in an interview today.

2015-02-05 00:00:00 Commercial Mortgage-Backed Securities: Approaching the Later Innings of a Recovery by Bryan Tsu of PIMCO

With the U.S. recovery as a supportive backdrop, PIMCO expects commercial real estate prices to rise 4%-6% in 2015. Commercial mortgage-backed securities issuance has increased for five years, and projections for 2015 are for growth of 20%-30%, driven largely by an increase in maturing loans on the supply side and the continued search for yield on the demand side. The growth in issuance does not come without concern: CMBS underwriting standards will likely continue to slip.

2015-02-05 00:00:00 ISM Data for January Point to Modest U.S. Real GDP Growth in 2015 Q1 by Robert Lamy of The Forecasting Advisor

At the start of each month, the U.S. Institute for Supply Management (ISM) released data on the state of the manufacturing and non-manufacturing industries of the U.S. economy. The data are closely followed by economists, stock market brokers, and the media as they provide the earliest reading on the current state of the economy. The ISM provides data on the current performance of a number of indicators related to the manufacturing and non-manufacturing industries, such as production, employment, new orders, and backlog of orders, deliveries, inventories, new exports, imports, and prices.

2015-02-05 00:00:00 US vs G7: Decoupling? Recoupling! by Alexander Giryavets of Dynamika Capital L.L.C.

We review how the U.S. growth and inflation relate to that of G7 over the last forty years and conclude that not only the decoupling incidents are nothing more than temporary deviations seen as noise in the long run but also that U.S. has actually just recoupled.

2015-02-05 00:00:00 What To Look For When The Price Of Oil Has Bottomed by Urban Carmel of The Fat Pitch

SPX has now fallen 4 of the last 5 weeks, including this past one. For the week, SPX and DJIA each lost nearly 3% and NDX lost 0.8%.

2015-02-05 00:00:00 The Pursuit of Pricing Power by Robert McConnaughey of Columbia Management

Recent oil and commodity price declines have raised concerns about global deflation and price stability. While the circumstances around oil’s precipitous decline are unique, many industries have built up capacity in recent years to serve a level of global growth that is not likely to reappear in the intermediate future.

2015-02-05 00:00:00 The Long View: Is The Bull Market In Bonds Almost Over? by Lance Roberts of Streettalk Live

There has been much debate about the current low levels of interest rates in the economy today. The primary argument is that the "30-year bull market in bonds", due to consistently falling interest rates, must be near its end. Of course, this debate has devastated the "bond bears" who have consistently been frustrated by lower interest rates despite their annual predictions to the contrary. However, just because interest rates are currently low, does this necessarily mean that they must rise?

2015-02-05 00:00:00 Ditch the Good, Buy the Bad and the Ugly by Ben Inker of GMO

In a new quarterly letter to GMO's institutional clients, co-head of asset allocation Ben Inker provides background on why, "as the New Year begins, we in Asset Allocation find ourselves slowly selling down even our beloved U.S. quality stocks in favor of the various problem children of the investing world" ("Ditch the Good, Buy the Bad and the Ugly").

2015-02-05 00:00:00 Why Were We So Surprised? by Jeremy Grantham of GMO

Chief investment strategist Jeremy Grantham examines the sources for the "unique decline" in the oil price since June, and offers an outlook for the coming years -Why Were We So Surprised? The Oil Glut, Saudi Decisions, and the Uniqueness of U.S. Fracking

2015-02-04 00:00:00 Why global currency investing still makes sense by Michael A. Cirami, Eric Stein, John R. Baur, Matthew F. Murphy, Jr., Bradford Godfrey of Eaton Vance

Why global currency investing still makes sense – even amid a strong dollar We believe there are three reasons why many investors should remain committed to a diversified global currency strategy – even if the US dollar remains strong.

2015-02-04 00:00:00 Woody Hayes on Portfolio Management by William Smead of Smead Capital Management

“There are three things that can happen when you pass the football and two of them are bad,” observed The Ohio State University’s legendary coach Woody Hayes. All the Seahawk fans, myself included, know exactly what he is talking about since the Seahawks chose to pass the ball at the one-yard line. You can complete a pass, you can throw it for an incompletion, or you can throw it to the other team (an interception). The same thing can be said for existing common stocks in your equity portfolio.

2015-02-04 00:00:00 The Trouble With Zero by Roger Nusbaum of AdvisorShares

We have watched the decline in crude noting the slow decline that started in June that then turned into a crash starting at around $75 at Thanksgiving. The circumstances of crashes are always “different” but the market action is very similar almost every time and the oil market is showing the same pattern for now.

2015-02-04 00:00:00 The Opportunity in Volatility by Heather Rupp of AdvisorShares

While 2014 was characterized largely by the lack of volatility for most the year, and active management suffered as a result, we see those tables turning in 2015 as we expect this volatility to continue. As we sit today, we see an attractive entry point into the high yield market for active managers who can parse through the space to determine where there is value to be had, and where there are value-traps.

2015-02-04 00:00:00 Australia Coming Apart at the Seams by Mike Shedlock of Sitka Pacific

With the huge spotlight on Europe, Greece, the US Dollar, Canada, Switzerland, and China, it's easy to lose track of major things outside of mainstream attention. Like what? Like Australia. Australian Government on Brink of Collapse

2015-02-04 00:00:00 The Absolute Return Letter - January 2015 by Team of Absolute Return Partners

In large parts of the financial community there is a strongly held belief that the problems which caused the credit crisis back in 2008-09 have never been properly addressed, causing many to suspect that it is only a matter of time before the ‘end game’ is upon us – the credit crisis Mk. II so to speak. I will in the following pages look at various ways the end game might unfold but, before I do so, I shall return to one of the subjects I discussed in the January letter – the end of cheap oil – which caused a flurry of comments and questions.

2015-02-04 00:00:00 Developed Europe: Economy Trends Update by Team of Thomas White International

Thomas White International seeks superior performance by identifying undervalued securities in the U.S. and nearly 45 markets worldwide. Its flagship product is the Thomas White International Fund (TWWDX).

2015-02-04 00:00:00 Global Carry Rock ‘n’ Roll by Alexander Giryavets of Dynamika Capital L.L.C.

Global Carry (known as Risk Parity to some) got a bit of a headwind in December (as we proclaimed it to do on Black Friday) but went straight back to Rock ‘n’ Roll as this year started, good to great. And while the other utterly famous star – the Yen is patiently await, shocked and subdued by her competitor act, all the eyes are on the King of Rock – the Dollar. Some still have his last year stellar performance tune on the mind, but is he about to sing “The times they are a changin’”?

2015-02-04 00:00:00 Is It Time for Our Industry To Embrace Mass Personalization? by Patty Quinn McAuley of Clark Capital Management Group

Nike. Coca-Cola. Oakley. They are all top brands in the global marketplace and they have all led the charge towards mass customization and personalization. You can build a custom pair of Nike Free Run sneakers online, incorporating your favorite designs and colors. You can put your name on a virtual Coke bottle and “share” it on social media. You can even custom-build your own shades on Oakley.com, creating your own unique pair of sunglasses.

2015-02-04 00:00:00 What's Up? Quantitative Easing and Inflation by Chris Brightman of Research Affiliates

The Fed has ceased its program of quantitative easing (QE) and may soon begin to raise interest rates. Japan has embarked on an even more aggressive program of QE. The European Central Bank (ECB) has just begun QE. In a related development, the Swiss National Bank (SNB) recently stopped pegging the Swiss franc to the euro. Many investors are asking, “What does all this monetary turmoil mean?”

2015-02-04 00:00:00 Greek Drama by Chris Brightman of Research Affiliates

Alexis Tsipras, the new prime minister of Greece, was elected because he and the Greeks who voted for him oppose the austerity imposed by Greece’s creditors. Apparently, markets were shocked by this turn of events: Greek bond yields spiked and bank stock prices plunged as euros began flowing out of the country. But should this scene have been a surprise?

2015-02-04 00:00:00 There's Diversity in Value by Brent Leadbetter and John West of Research Affiliates

A portfolio comprising long positions in individual fundamentally weighted country indices and short positions in cap-weighted country indices might prove to be the Boris Diaw of a diversified portfolio. Investors would be unlikely to meet their return targets by concentrating all their assets in such a strategy. However, given its high Sharpe ratio and low correlation with widely used asset classes, it seems a suitable addition to a robust asset mix.

2015-02-04 00:00:00 Don't fret about January effect by Burt White of LPL Financial

The stock market fell in January, causing some to ask whether the so-called January effect means that stocks will fall this year. Recall less than four weeks ago the “first five days” indicator sent a positive stock market signal for 2015. We always put fundamentals first when forecasting stock market direction—and on that score, we believe stocks still look good.

2015-02-04 00:00:00 Gallup CEO Calls 5.6% Unemployment Rate "The Big Lie": What's a Realistic Unemployment Rate? by Mike Shedlock of Sitka Pacific

On Linked-In, Gallup CEO, Jim Clifton proclaims 5.6% unemployment is "The Big Lie". And it is. I have talked about this for years, but perhaps it would be interesting to hear the same thing from a CEO of a big agency. I picked this story up from ZeroHedge.

2015-02-04 00:00:00 January employment report preview by John Canally of LPL Financial

The market is expecting the economy to add 235,000 net new jobs in January 2015 and for the unemployment rate to remain at 5.6%. Other measures of the health of the labor market--hiring rates, the quit rate, the unemployment rate, and most importantly, wages--still show that the labor market is not yet back to normal.

2015-02-03 00:00:00 Facing Reality by Questioning Some Common Beliefs by Ron Surz (Article)

I've decided to do something different in this quarterly commentary. I begin as usual with a review of first quarter market performance. Then I turn my attention to some commonly held beliefs that I regard as mistaken, as shown in the figure below.

2015-02-03 00:00:00 How to Link Retirement Strategies to Sustainable-Spending Rates by Wade Pfau (Article)

Last week, my article introduced the Retirement Accumulation and Retirement Affordability indices, which help clients determine if they are retiring at a good time. In this article, I will present my new Retirement Dashboard. More specifically, I will explain how advisors can determine the appropriate sustainable-spending rate based on their client's desired spending pattern.

2015-02-03 00:00:00 Ben Hunt: Investing Lessons from the Poker Table by Justin Kermond (Article)

Markets have not been this dominated by political uncertainty and divorced from economic fundamentals since the 1930s. Ben Hunt - Harvard Ph.D., the author of the Epsilon Theory Newsletter, and Chief Risk Officer at Salient Partners, an asset manager based in Houston, TX - provides useful lessons from game theory for thriving in what he calls "the age of central bankers."

2015-02-03 00:00:00 The Secret to Empathizing with Prospects by Daniel Solin (Article)

It's quite easy to empathize with a loved one. But how do you demonstrate empathy with your prospect, who is a stranger?

2015-02-03 00:00:00 Coaching an Uncooperative Employee by Beverly Flaxington (Article)

Is it possible to coach someone who doesn't really want the job they have?

2015-02-03 00:00:00 Doing Business Through the Know, Like, and Trust Process by Teresa Riccobuono (Article)

We have all heard the phrase, "People like doing business with people they know, like and trust." But how does one get to the point of trust in a relationship?

2015-02-03 00:00:00 Making Your Practice a Magnet for Seniors by Dan Richards (Article)

Many advisors believe that their practice is senior-friendly if their office doesn't require climbing a flight of stairs and their client newsletters are in large type. To test that premise, recently I hosted a roundtable lunch for several advisors who've built a niche working with seniors.

2015-02-03 00:00:00 A Greek Morality Tale by Joseph E. Stiglitz of Project Syndicate

When the euro crisis began a half-decade ago, Keynesian economists predicted that the austerity imposed on Greece and the other crisis countries would fail. Now that it has, what is needed is not structural reform in Greece so much as a fundamental reform of the eurozone's design and policy frameworks.

2015-02-03 00:00:00 Deflation: Consternation Not Elation by Matt Lloyd of Advisors Asset Management

Deflation has been around ever since there was an excess supply of something or when demand had plummeted. The term “deflation” has now become mainstream in the general public’s lexicon, though the understanding of the declining economic growth that corresponds with it is often disregarded until it wreaks havoc on the consumer’s paycheck. When we see deflation permeating global economics, market movements and NFL games, the general public will become acutely aware of the other major impact from deflation, the increasing symbiotic nature of all the global economies.

2015-02-03 00:00:00 Connecting the Dots: Procter & Gamble, the Strong Dollar, and Pepto Bismol by Tony Sagami of Mauldin Economics

Collectively, the 500 companies in the S&P 500 get 46% of their sales and roughly 50% of their profits from outside the US. They are truly multinational giants. Expanding your customer base is always a good thing, but doing business overseas is not without peril, and one of the under-appreciated perils is the impact of currency movements.

2015-02-03 00:00:00 Retirement Realities and Contingencies by Roger Nusbaum of AdvisorShares

Stites on Estates took an interesting look at retirement intentions versus retirement reality along with a reiteration of the dismal statistics about how little savings people who are working have accumulated as well as how few dollars people have put away when beginning their retirement.

2015-02-03 00:00:00 The Bravado of Borrowers by Peter Schiff of Euro Pacific Capital

Last week a scene unfolded in Athens, largely unnoticed by American eyes, that provided all the visual and metaphorical symbols needed to define the current state of the global economy. Hollywood's best screenwriters couldn't have laid it out any better.

2015-02-03 00:00:00 Americas Economy Trends Update January 2015 by Team of Thomas White International

Thomas White International seeks superior performance by identifying undervalued securities in the U.S. and nearly 45 markets worldwide. Its flagship product is the Thomas White International Fund (TWWDX).

2015-02-03 00:00:00 PIMCO Introduces the PIMCO Multi-Strategy Alternative Strategy by of PIMCO

In a New Neutral environment that anticipates muted returns and heightened volatility, many investors have looked to liquid alternatives in an effort to boost returns and lower overall portfolio risks. Our approach seeks to efficiently combine a range of complementary liquid alternative strategies, offering the potential for diversification and higher return per unit of risk than a single strategy could achieve on its own. This strategy can play a central role in liquid alternatives allocations or be used as a stand-alone complement to traditional stock and bond allocations.

2015-02-03 00:00:00 Diving Into the ISM: What's It All Mean? by Mike "Mish" Shedlock of Sitka Pacific Capital

This morning the Institute for Supply Management released its much followed Manufacturing ISM® Report On Business®.

2015-02-03 00:00:00 Municipal Market Perspectives by Team of SMC Fixed Income Management

Pick your poison: weaker oil and copper prices; increasing gold demand; Swiss Franc and Canadian Dollar devaluations; another possible Greek tragedy; launch of European Central Bank (“ECB”) bond buying program; waning emerging markets; weakening U.S. stock prices; global deflation worries. It appears to us that the broadening global weakness could be beginning to negatively impact the U.S. expansion. Given the current state of global events, we see no reason for the Fed to prematurely move ahead with its rate normalization plan as many anticipate occurring by mid-year 2015.

2015-02-03 00:00:00 Tax Reform: No Hope for Change by Milton Ezrati of Lord Abbett

The latest proposals from the White House all but ensure that no progress will be made on sorely needed tax-code fixes in 2015.

2015-02-03 00:00:00 Woody Brock on Why to Own Stocks Now - Video by Robert Huebscher (Article)

Dr. Horace 'Woody' Brock is the founder Strategic Economic Decisions and the author of American Gridlock. In a recent talk, he explained why investors should own stocks ? particularly those with stable dividends ? and why bonds are very risky in today's environment. This is the video; a transcript of this talk is also available.

2015-02-03 00:00:00 Seeking Value Amid Volatility by Russ Koesterich of BlackRock

Stocks struggled last week, and once again the losses were most pronounced in the United States. Financial markets remain highly volatile, with violent swings in the oil price and interest rates adding to the angst. With the Fed likely to start removing monetary accommodation, 2015 was bound to be a more volatile year than last.

2015-02-02 00:00:00 Market Action Suggests Abrupt Slowing in Global Economic Activity by John Hussman of Hussman Funds

The combination of widening credit spreads, deteriorating market internals, plunging commodity prices, and collapsing yields on Treasury debt continues to be most consistent with an abrupt slowing in global economic activity.

2015-02-02 00:00:00 Tracking the Market with Social Media by Blair Jensen of Trade Followers

Last week the Trade Followers social media indicators for the S&P 500 Index (SPX) suggested that the market wasn’t out of the woods yet due to several factors. Chief among them was a warning from our sector sentiment readings. They indicated that market participants were rotating to safety as the market rallied. Every time all sectors were positive since we’ve been tracking them has resulted in a short term top within two weeks.

2015-02-02 00:00:00 Weighing the Week Ahead: Will the data deluge signal economic weakness? by Jeff Miller of New Arc Investments

This is a landslide week for economic data, and earnings season is in full swing. Last week’s Q4 GDP report and overall market tone has revived deflation concerns. I expect market participants to be watching each economic release closely, asking: Are there signs of incipient economic weakness?

2015-02-02 00:00:00 What Is Plan B for Greece? by Kenneth Rogoff of Project Syndicate

Though the far-left Syriza party’s recent election victory has sent Greek equities and bonds plummeting, there is little sign of contagion to other distressed countries on the eurozone periphery. The question is how long this relative calm will prevail.

2015-02-02 00:00:00 Perception vs Reality - Rates of Return by John Riley of Cornerstone Investment Services

What is the annual average rate of return for the market? 10.00%? 12.50%? 15.00%? This is one of those "facts" that investors hear from friends, the media and the investment industry, and it is usually wrong.

2015-02-02 00:00:00 Why the Rest of 2015 May Not Look Like January by Robert Doll of Nuveen Asset Management

January was a rough month for equity markets. Volatility increased and stocks endured some notable setbacks. For the month, the S&P 500 Index fell 3.0% after declining 2.8% last week. We believe, however, that the same factors pushing stock prices lower will actually support longer-term economic growth. We expect markets will stabilize and recover in the coming months, and believe that by the end of 2015 equity prices will be at a higher level than where they began the year.

2015-02-02 00:00:00 Fooled By Extrapolation by Brian Wesbury, Robert Stein of First Trust Advisors

Pundits have a bottomless reservoir of pessimism and also a magnified ability to extrapolate the most recent trends. So, when Q1-2014 real GDP fell at an annual rate of 2.1%, fear turned rampant.

2015-02-02 00:00:00 Portfolio Strategies 2015: Investing in an Age of Divergence by John Mauldin of Mauldin Economics

Everyone is worried about being blindsided by a significant downdraft in the markets when maybe we should be thinking about making sure we don’t miss a bull market somewhere. These and several dozen other topics were on the table when the Mauldin Economics writing team gathered here in Dallas for 3½ days of intensive talk, interviews, and planning. Today we’ll go over a few of the highlights of this last week, and I’ll share a few reasons to be optimistic about 2015.

2015-02-01 00:00:00 Weekly Market Summary by Urban Carmel of The Fat Pitch

SPX has now fallen 4 of the last 5 weeks, including this past one. For the week, SPX and DJIA each lost nearly 3% and NDX lost 0.8%. Tthe indices and most of the sectors have fallen under their key moving averages. Many of these now have a declining slope. Over the past month, price has made lower highs. All of this suggests that the trend is down. Moreover, bullish set ups are failing, a warning that price has not reached an oversold level. Despite the sell off, breadth and longer term measurements of sentiment have not washed out to an extent that would suggest a low is in place. Finally, th

2015-01-31 00:00:00 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Calculating the consequences of budget policies is a global headache. The recent round of central bank easing may continue for a while. Reports of a budding currency war are exaggerated

2015-01-31 00:00:00 The Super Bowl of Investing by Robert Isbitts and Vincent Esposito of Sungarden Investment Research

Here is our list of official National Football League penalties — as applied to investors. Don’t get penalized, think your way through today’s environment, or find a money management specialist who can.

2015-01-31 00:00:00 Diverging Policies…Converging Economies? by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

The US economy should continue to expand but faces headwinds with weak global growth and a strengthening dollar leading to diverging central bank policies. Volatility has risen and the potential for a correction in the near term appears more likely. Nonetheless, timing the market in the shorter-term is dangerous, while the longer-term picture still looks positive for US equities. Across the pond, we remain skeptical much can be accomplished with the ECB’s QE program and continue to favor emerging markets over developed internationally. We also believe global diversification is becomin

2015-01-31 00:00:00 Encouraging Lifetime Income in US DC Plans by Daniel A. Notto of AllianceBernstein

With the continuing shift from defined benefit (DB) plans to defined contribution (DC) plans, fewer Americans have the ability to enjoy guaranteed income for life. Now, federal regulators are trying to change that.

2015-01-31 00:00:00 An Unconventional Truth by Nouriel Roubini of Project Syndicate

To be effective, monetary stimulus must be accompanied by temporary fiscal stimulus, which is now lacking in all major economies. That is why, given persistent insufficient aggregate demand, unconventional monetary policies will remain a central feature of the macroeconomic landscape.

2015-01-30 00:00:00 Finding Tax-Free Transfer Opportunities in Undervalued Energy Stocks by Carin Pai, Elisa Shevlin Rizzo of Fiduciary Trust Company International

In the past few weeks, crude oil has extended its biggest price slump since the 2007-2009 global financial crisis, dropping to the lowest levels since 2009 amid signs of softer demand growth from major economies, strong output from the US and steady output from the rest of the world.

2015-01-30 00:00:00 PIMCO Extends Its Dividend Suite With Two New Regional Strategies by Brad Kinkelaar, Adam Muller of PIMCO

As is the case with our other dividend strategies, we are unconstrained by benchmarks and focused on generating yield and capital appreciation by finding attractively valued companies that pay appealing dividends today and have an ability and willingness to grow dividends over time.

2015-01-30 00:00:00 The Great Complacency...Continued by Jeffrey Bronchick of Cove Street Capital

At this point last year, we were effusively cautious after a period of terrific performance. We suggested that while we considered a material number of portfolio stocks to represent "solid" values, their near-term appreciation was going to be limited after the big numbers of 2013.

2015-01-30 00:00:00 Is Dividend Investing Passe? by Yu Zhang of Matthews Asia

Dividends can be used as a lens through which we attempt to identify high-quality, financially healthy companies with prudent capital allocation policies.

2015-01-30 00:00:00 Over Half The Stocks In The MSCI World Index Are Outperforming The Index For The First Time In A Yea by Team of GaveKal Capital

For the first time in exactly one year, over half the stocks (51%) in the MSCI World Index are outperforming the headline MSCI World Index over the past 252 trading days (1-year). This is the highest percentage of stocks outperforming in exactly one year.

2015-01-30 00:00:00 The Next Act in the Greek Drama by Russ Koesterich of BlackRock

The outcome of Greece’s election suggests a prolonged period of heightened tensions and difficult negotiations with the troika. Compromises are possible, but reform efforts could fall by the wayside.

2015-01-30 00:00:00 Weighing the Odds of Compromise in Greece, and the “Grexit” by Heather Arnold, Cindy Sweeting, Norm Boersma of Franklin Templeton Investments

Against a backdrop of growing dissatisfaction with Greece’s bailout terms [imposed by the “troika” of lenders comprised of the European Commission, European Central Bank (ECB) and International Monetary Fund], the country’s parliament failed to decisively elect a president in December 2014, resulting in the dissolution of the parliament and the calling of new elections for January 25, 2015.

2015-01-30 00:00:00 7 Things about Saudi Arabia You Need to Know by Frank Holmes of U.S. Global Investors

A week ago we learned that the king of Saudi Arabia, Abdullah bin Abdulaziz Al Saud, passed away at the age of 90. Following the announcement, crude oil immediately spiked 2.5 percent over uncertainty of how this might affect the Middle Eastern kingdom’s position on keeping oil production at current levels.

2015-01-30 00:00:00 Reforms in Asia Bring Big Potential for Small Companies by Team of Franklin Templeton Investments

At Templeton Emerging Markets Group, we believe Asia’s combination of rapid economic growth, generally strong national finances and economic fundamentals has created an attractive landscape for equity investors. Seismic changes have been taking place in Asia’s political arena over the past couple of years, including major elections, leadership transitions and even a military coup. These political shifts have economic reform implications as well.

2015-01-30 00:00:00 Opportunities and Risks for Investors After the Oil Price Slump? by Daniel Lacalle of PIMCO

What we are seeing now is that oil prices, when OPEC refuses to balance the market, test the marginal cost of production, and costs fall. Some of the costs of the largest components of oil projects – high-spec sixth-generation rigs, pressure pumping, seismic, completion – have fallen between 20% and 45% in the space of months as overcapacity became evident and capital expenditure was revised downward.

2015-01-30 00:00:00 Wall Street for President? by Simon Johnson of Project Syndicate

America's Democratic Party – including President Barack Obama – is apparently of two minds on the extent to which it should defend its own financial legislation from attack by the country's powerful megabanks. It can have the 2010 Dodd-Frank reforms, or it can have Wall Street's campaign contributions, but it cannot have both.

2015-01-30 00:00:00 Voya Fixed Income Perspectives – January 2015 by Christine Hurtsellers, Matt Toms of Voya Investment Management

Voya Investment Management’s fixed income strategies cover a broad range of maturities, sectors and instruments, giving investors wide latitude to create a new portfolio structure or complement an existing one.

2015-01-30 00:00:00 Accentuate the Positive: The Psychological Inflation of Quarterly GDP by Doug Short (Article)

Note from dshort: I've updated the last chart in this commentary to include today's Q4 GDP Advance Estimate of real quarterly GDP. The BEA's annualized growth rate of 2.6% (2.64% to two decimals) is based on a 0.65% quarter-over quarter percentage change.

2015-01-29 00:00:00 Household Income versus Family (Tax-Unit) Income by Doug Short (Article)

My virtual acquaintance New Deal Democrat has posted an interesting article on real (inflation-adjusted incomes) based on annual IRS tax data through 2013. His discussion includes some comparisons between the Census Bureau's median Household Income data and the Family Unit average income. A Family Unit is the term used for an IRS designated Tax Unit (e.g., a couple with dependents, or a head of household with dependents, or a single person).

2015-01-29 00:00:00 The Unintended Consequences of "Sophisticated" Performance Measurement by Francois Sicart of Tocqueville Asset Management

Sicart believes a measure of investment success should encompass "several cycles, with bull and bear markets as well as many fads and fashions and their aftermaths." He notes that "economic events really progress at a near-tectonic pace," so "a quarter or even a year is almost always a totally irrelevant period."

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